WASHINGTON, D.C. – While most eyes are focused on the massive $1.7 trillion Omnibus Spending Bill slowly making its way through Congress, U.S. Rep. Blake Moore (R-UT) has introduced legislation to protect adoptive parents from audits by the Internal Revenue Service.
The Protecting Adopting Families from Audits Act of 2022 was jointly introduced by Moore and colleague Rep. Lloyd Smucker (R-PA) on Dec. 16.
“Throughout my first term in Congress, I have consistently advocated for families navigating the adoption process,” Moore explained.
“The adoption process is already arduous and expensive,” he added. “We must do all we can to ensure that the Adoption Tax Credit is administered fairly and efficiently so children in need find forever families.”
“An Internal Revenue Service (IRS) audit is no way to show thanks to families who are adopting children,” Smucker argued. “Yet, that appears to be exactly what is happening to the overwhelming majority of families claiming the Adoption Tax Credit.”
The adoption tax credit (ATC) is a tax credit offered to parents to encourage adoption in the United States. This credit can be applied to qualified and reasonable expenses for international, domestic private and public foster care adoption.
The maximum that taxpayers can claim is $14,440 per eligible child, but the credit is non-refundable. That means that it can only be applied against the taxpayer’s already existing tax liability.
The IRS specifies that reasonable expenses include adoption fees; court costs and legal fees; adoption related travel expenses; and other expenses related to legal adoption of an eligible child.
In the past, according to Moore’s staff, parents who claimed the ATC were subjected to high audit rates. In 2012, for example, nearly 70 percent of families claiming the ATC were audited by the IRS.
Since then, the IRS has reportedly taken action to resolve that problem.
“But Congress has not yet received data confirming that this issue has been properly resolved,” Moore said. “The IRS also decided against following all of the recommendations from the Government Accounting Office (GAO) to resolve the problem.”
To fill in information gaps and provide continuing oversight, the Protecting Adopting Families from Audits Act would require the IRS to furnish three types of reports to the House Ways & Means and the Senate Finance committees.
Those reports would include information on the audit rates of families that have received the ATC since 2008; an annual report projecting ATC audit rates through 2032 (which would provide insight into how the Inflation Reduction Act impacts audit rates); and an analysis of how IRS audits impact personal tax credits differently depending on whether they are refundable or non-refundable.
The Protecting Adopting Families from Audits Act has garnered support from the several non-profit groups advocating for adoptive families including National Council for Adoption; the North American Council on Adoptable Children; and Raise the Future.
“The National Council for Adoption welcomes this opportunity to learn more about how the Adoption Tax Credit has been utilized,” said Ryan Hanlon, president and CEO of NCFA. “We are eager to ensure that adoptive families are not specifically targeted for audits just because they chose to adopt.”
“I am proud to introduce the Protecting Adopting Families from Audits Act with Congressman Smucker to help us understand how the IRS administers the Adoption Tax Credit and to prevent future issues – including unfair auditing rates – that may complicate the process for families pursuing adoption.”
“Parent trying to build strong families should not face undue burdens,” Smucker concluded.
“A positive home life is key to a child’s ability thrive, and the Connecting Forever Families Act is the direct result of engagement with Utahns who are working hard to connect more forever families.
Last year, I hosted a roundtable at the Utah state Capitol on foster care and adoption to hear directly from government and nonprofit stakeholders who are advocating on behalf of Utah’s most vulnerable children every day, and this was one of the solutions that was discussed.
Family is the foundation of Utah’s core values, and it’s been an honor to work with constituent leaders who are creating better outcomes for Utah’s children.” Blake Moore
I think it is an awesome idea to help more with the children that are left without families/ a place to call home. What about the parents that are struggling with addictions that make the choice to give up their child? Do we provide them with mental health options after? sex education in schools? adoption options?? Adoption is a hard choice. I am a mother of two beautiful children, and I feel lost without them. Some mothers still feel this way even when they know it is the right thing to do. Some of the fathers do not even know they had children in someone’s belly.
There are a lot of amazing people that can provide a forever home to children but why shouldn’t they be audited? They should go through some obstacles to see if they are ready to take on this commitment. They are being granted more money to take care of children that are not biologically theirs. These children come with a lot of traumas that may not be shown the first day of having care of these children.
Taking on the responsibility of being a parent is a huge commitment/lifelong commitment. Taking on someone else’s biological children comes with even more responsibilities. Some of these children have been born with substances they are addicted to from coming out of the womb. The traumas associated with adoption are very difficult as well. Do we provide education to these parents taking on that responsibility? I have heard far too many horrific stories about families abusing their adoptive children or use their children as “slaves”. I have seen adoptive families providing worse care than the addict mom/dad ever would/did.
We should provide better education on the risks of having unprotected sex. If we are to say abstinence is the only way, that is a lie to human beings. We are made to procreate. And, to some people the love someone gives them by saying how pretty they are is “love” to them. Some people have never had proper education on the risks of unprotected sex. I am a religious person, but I am also a realist. Hormones happen.
I know someone very dear to me that was adopted and never felt good enough from their adoptive parents. They had the resources to take care of lots of children, but they couldn’t give birth to children biologically. They made that individual feel like burden every second of existence, because of the “hard work” he was. I have a close friend that placed her baby up for adoption due to substances. They still feel guilt and shame after giving that child up years later and therapy after. I have heard numerous stories of sexual abuse from adoptive parents. I have seen a family take on 3 children and they have neglected them far worse than the addict mother. So, whom is this really helping? and what should we really be focusing on?