If you adopted a child last year and requested an extension of time to file your 2011 taxes, you may be able to claim the expanded adoption credit on your federal tax return. The Affordable Care Act temporarily increased the amount of the credit and made it refundable, which means it can increase the amount of your refund.

Here are eight things to know about this valuable tax credit:

  1. The adoption credit for tax year 2011 can be as much as $13,360 for each effort to adopt an eligible child. You may qualify for the credit if you adopted or attempted to adopt a child in 2010 or 2011 and paid qualified expenses relating to the adoption.
  2. You may be able to claim the credit even if the adoption does not become final. If you adopt a special needs child, you may qualify for the full amount of the adoption credit even if you paid few or no adoption-related expenses.
  3. The credit for qualified adoption expenses is subject to income limitations, and may be reduced or eliminated depending on your income.
  4. Qualified adoption expenses are reasonable and necessary expenses directly related to the legal adoption of the child who is under 18 years old, or physically or mentally incapable of caring for himself or herself. These expenses may include adoption fees, court costs, attorney fees and travel expenses.
  5. To claim the credit, you must file a paper tax return and Form 8839, Qualified Adoption Expenses, and attach all supporting documents to your return. Documents may include a final adoption decree, placement agreement from an authorized agency, court documents and the state's determination for special needs children. You can use IRS Free File to prepare your return, but it must be printed and mailed to the IRS. Failure to include required documents will delay your refund.
  6. If you filed your tax returns for 2010 or 2011 and did not claim an allowable adoption credit, you can file an amended return to get a refund. Use Form 1040X, Amended U.S. Individual Income Tax Return, along with Form 8839 and the required documents to claim the credit. You generally must file Form 1040X to claim a refund within three years from the date you filed your original return or within two years from the date you paid the tax, whichever is later.
  7. The IRS is committed to processing adoption credit claims quickly, but must also safeguard against improper claims by ensuring the standards for receiving the credit are met. If your return is selected for review, please keep in mind that it is necessary for the IRS to verify that the legal criteria are met before the credit can be paid. If you are owed a refund beyond the adoption credit, you will still receive that part of your refund while the review is being conducted.
  8. The expanded adoption credit provisions available in 2010 and 2011 do not apply in later years. In 2012 the maximum credit decreases to $12,650 per child and the credit is no longer refundable. A nonrefundable credit can reduce your tax, but any excess is not refunded to you.

For more information see the ‘Adoption Benefits FAQs' page available at IRS.gov or the Form 8839 instructions. The forms and instructions can be downloaded from the website or ordered by calling 800-TAX-FORM (800-829-3676).

TaxACT Free Federal and Deluxe Editions include step-by-step guidance for claiming the adoption credit through Form 8839. If you need to amend your 2011 tax return, TaxACT Deluxe will help you complete the steps for Form 1040X.

Start a 2011 return, sign in to your 2011 TaxACT Online account, or start your desktop program now.

Links:

  • Adoption Benefits FAQs
  • Instructions for Form 8839 (PDF)
  • Publication 4903, Affordable Care Act Expands Adoption Tax Credit Flyer (PDF)
  • Instructions for Form 1040X (PDF)
February 2015
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Upcoming Tax Dates

February 2 Individuals who must make estimated tax payments
If you did not pay your last installment of estimated tax by January 15, you may choose (but are not required) to file your income tax return (Form 1040) for 2014 by February 2. Filing your return and paying any tax due by February 2 prevents any penalty for late payment of the last installment. If you cannot file and pay your tax by February 2, file and pay your tax by April 15.

February 2 All Employers
Give your employees their copies of Form W2 for 2014. If an employee agreed to receive Form W2 electronically, have it posted on a website and notify the employee of the posting.

February 2Payers of gambling winnings
If you either paid reportable gambling winnings or withheld income tax from gambling winnings, give the winners their copies of Form W2G.

February 2 Nonpayroll taxes
File Form 945 to report income tax withheld for 2014 on all nonpayroll items, including backup withholding and withholding on pensions, annuities, IRAs, gambling winnings, and payments of Indian gaming profits to tribal members. Deposit or pay any undeposited tax under the accuracy of deposit rules.

February 2 Social Security, Medicare, and withheld income tax
File Form 941 for the fourth quarter of 2014. Deposit or pay any undeposited tax under the accuracy of deposit rules. If your tax liability is less than $2,500, you can pay it in full with a timely filed return. If you deposited the tax for the quarter timely, properly, and in full, you have until February 10 to file the return.

February 2 Certain small employers
File Form 944 to report social security and Medicare taxes and withheld income tax for 2014. Deposit or pay any undeposited tax under the accuracy of deposit rules. If your tax liability is $2,500 or more for 2014 but less than $2,500 for the fourth quarter, deposit any undeposited tax or pay it in full with a timely filed return. If you deposited the tax for the year timely, properly, and in full, you have until February 10 to file the return.

February 2 Farm employers
File Form 943 to report social security and Medicare taxes and withheld income tax for 2014. Deposit or pay any undeposited tax under the accuracy of deposit rules. If your tax liability is less than $2,500, you can pay it in full with a timely filed return. If you deposited the tax for the year timely, properly, and in full, you have until February 10 to file the return.

February 2 Federal unemployment tax
File Form 940 for 2014. If your undeposited tax is $500 r less, you can either pay it with your return or deposit it. If it is more than $500, you must deposit it. However, if you deposited the tax for the year timely, properly, and in full, you have until February 10 to file the return.

February 2All businesses
Give annual information statements to recipients of certain payments you made during 2014 - Details

February 2Form 720 taxes
File Form 720 for the fourth quarter of 2014.

February 2 Wagering tax
File Form 730 and pay the tax on wagers accepted during December 2014.

February 2Heavy highway vehicle use tax
File Form 2290 and pay the tax for vehicles first used in December 2014.

February 10Nonpayroll taxes
File Form 945 to report income tax withheld for 2014 on all nonpayroll items. This due date applies only if you deposited the tax for the year timely, properly, and in full.

February 10Social security, Medicare, and withheld income tax
File Form 941 for the fourth quarter of 2014. This due date applies only if you deposited the tax for the quarter timely, properly, and in full.

February 10Certain small employers
File Form 944 to report social security and Medicare taxes and withheld income tax for 2014. This due date applies only if you deposited the tax for the year timely, properly, and in full.

February 10Farm employers
File Form 943 to report social security and Medicare taxes and withheld income tax for 2014. This due date applies only if you deposited the tax for the year timely, properly, and in full.

February 10Federal unemployment tax
File Form 940 for 2014. This due date applies only if you deposited the tax for the year timely, properly, and in full.

February 10Employees who work for tips
If you received $20 or more in tips during January, report them to your employer - Details

February 11Communications and air transportation taxes under the alternative method
Deposit the tax included in amounts billed or tickets sold during the first 15 days of January.

February 13Regular method taxes
Deposit the tax for the last 16 days of January.

February 17Everyone
Federal Holiday (Washington's Birthday) - Details

February 17Individuals
If you claimed exemption from income tax withholding last year on the Form W-4, you must file a new Form W-4 by this date to continue your exemption for another year - Details

February 17All businesses
Give annual information statements to recipients of certain payments you made during 2014 - Details

February 17Publication 509 (2015)
All payments reported on Form 1099S, Proceeds From Real Estate Transactions. Substitute payments reported in box 8 or gross proceeds paid to an attorney reported in box 14 of Form 1099MISC.

February 17Social security, Medicare, and withheld income tax
If the monthly deposit rule applies, deposit the tax for payments in January.

February 17Nonpayroll withholding
If the monthly deposit rule applies, deposit the tax for payments in January.

February 18All employers
Begin withholding income tax from the pay of any employee who claimed exemption from withholding in 2014, but did not give you Form W4 to continue the exemption this year.

February 25Communications and air transportation taxes under the alternative method
Deposit the tax included in amounts billed or tickets sold during the last 16 days of January.

February 27Regular method taxes.
Deposit the tax for the first 15 days of February.

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