Financial Options for Adoptive Parents

Employee Benefits Programs
Check to see if your employer offers some type of adoption benefits to their employees. Benefits may include direct reimbursement anywhere from $2,000 to $10,000 once adoption is finalized, paid leave in addition to or including vacation time, sick leave or personal days, and medical expenses for the new child.
 
IRS tax credit of $10,000
The Hope for Children's ACT was established to help adoptive families receive a tax credit when adopting children domestically or internationally. As an adoptive parent, you are eligible to receive a one-time tax credit of up to $10,000 once your adoption is complete. This is a one-time tax credit, within a five year period from the time the adoption is complete. A credit is a dollar for dollar reduction in your tax bill for the coming year. There are income restrictions and specific ways in which you must apply for the credit, so check the IRS website for more current information.
 
Federal Family Medical Leave Act
Unpaid leave under the Federal Family Medical Leave Act is also an option. This act allows individuals to take up to 12 weeks off, unpaid with benefits without jeopardizing employment. The leave can provide valuable time for newly adoptive families to bond with their new child.
 
State Adoption Reimbursement Programs
Many states have programs that will reimburse families for "non-recurring adoption expenses" through their county and State Human Services Departments. You can check the state subsidy website at http://www.nacac.org/subsidy_stateprofiles.html for more information.
 
Military Subsidies
The military will reimburse active-duty personnel for most one-time adoption costs up to $2,000 per child. For more information about this reimbursement, call Adoption Exchange Association at 1-303-333-0845.
 
Loans
There are various types of loans available to help adoptive families handle the immediate expenses.
 
  1. Home Equity Loans: Interest rates often are reasonable and the interest is tax deductible. Just remember you are putting your home at risk.
  2. Insurance: You may be able to borrow from the cash value of your life insurance policy.
  3. Low-Interest Rates: Some banks offer low interest loans or credit lines for adoptive parents.
  4. Private Grant and Special Loan Programs: Adoption loans, both home equity and unsecured, may be obtained through the National Adoption Foundation. They also award grants to needy adoptive parents.
  5. Religious Organizations
  6. Relatives
Additional suggestions from other adoptive parents
(Please note: the following suggestions were collected from various internet adoption information sites and were provided by parents who chose to participate in discussions re: financial options.)
  • Home equity loans.
  • "Shaving and saving" - Shave money off of everything you do and put it in your savings account.
  • Look for an agency that will allow you to pay in increments.
  • Adoption tax credit.
  • Refinance your home.
  • Borrow money from relatives and pay them back with tax credit money.
  • Check out www.kids4us.org. Click on finances and they have some great suggestions about fundraising, plus some good connections to organizations that offer loans and grants.
  • Use an agency that allows you to use credit cards or use the low-interest "checks" that some credit card companies offer. They usually have a low-interest rate for a period of several months.
  • Company benefits.