TAXES & ADOPTION
Adopting a child is a heartwarming decision that is driven by compassion and fueled by love. It is an exciting choice that will change your life. Welcoming a child into your home is the easy part. Unfortunately, the logistics associated with adoption can be complicated and sometimes overwhelming. Not only do you have court fees and stacks of paperwork, but you also have taxes to consider.
As we all know, tax season can be stressful for any family. Add a pending adoption and it is even more complicated and can be frustrating. If the adoption is pending you may not have your to-be-adopted child’s Social Security Number. How do you claim them on your taxes without their Social Security Number? Well, the good news is the IRS has acknowledged that those still in the process of adoption have been providing for a child and should be able to claim the child on their taxes.
CONSULT AN EXPERT
When it comes time to complete your taxes, particularly when an adoption is involved, you might consider looking for an accountant that specializes in adoptions. You can ask your accountant about utilizing the IRS W-7A form. To put it simply, this form allows you to claim a child that is living in your home when the adoption isn’t finalized. A lot of accountants are not aware of this form so be sure to bring it up to your accountant. You can also find the form on the IRS website if you self-file your taxes.
You should be able to focus on providing a loving and welcoming home to your child and not have to worry about upcoming taxes. If you would like to know more about IRS Form W-7A or need help finding an adoption accountant, please check out this video.