FACTSHEET FOR FAMILIES

February 2011

Disponible en español www.childwelfare.gov/pubs/ s_costsp/index.cfm

Costs of Adopting

Prospective adoptive parents may be concerned about the costs of adopting a child and their ability What’s Inside: to meet those costs. Becoming a parent is rarely free of expenses—pregnancy and childbirth can • Universal expenses be expensive and even more so without adequate • -specific expenses insurance—and adoptive parents may be faced • Resources to help defray adoption costs with initial costs that seem challenging. However, • Additional resources with planning and knowledge about the different types of and available resources, they

Child Welfare Information Gateway Children’s Bureau/ACYF U.S. Department of Health and Human Services 1250 Maryland Avenue, SW Administration for Children and Families Eighth Floor Washington, DC 20024 Administration on Children, Youth and Families 800.394.3366 Children’s Bureau Email: [email protected] www.childwelfare.gov Costs of Adopting www.childwelfare.gov

can develop a budget to include most of the the total costs may be much less than the foreseeable expenses. This factsheet explains maximum figures cited here; resources may these expenses so that prospective adoptive also be available to help offset all or many parents can make informed decisions costs. These are discussed at the end of this throughout the adoption process. factsheet. Costs of adopting may be minimal or can Breaking down the total cost into total more than $40,000, depending on a categorized expenses helps prospective number of factors. The chart below outlines parents understand what is involved and some general categories of adoption and how to determine a predictable range for costs associated with the services provided. their costs. In some cases, understanding The wide range reflects the multitude of the costs associated with different types of factors that can affect costs, including adoption may help parents decide which the type of adoption, type of placement type of adoption to pursue, or whether to agency or facilitator, and child’s age and pursue this approach to building a family. circumstances. Prospective adoptive parents This factsheet can help by outlining and are encouraged to check with the agencies discussing the following categories of they are considering to find out more about expenses: specific costs for their circumstances. • Universal expenses: that is, those that occur for every type of adoption, RANGE OF ADOPTION COSTS including home study expenses and court costs. • Adoption-specific expenses: that is, those Public Agency () that are associated with a particular Adoptions $0 - $2,500 type of adoption, including public Licensed Private Agency agency (foster care) adoptions, private Adoptions $5,000 - $40,000+ (licensed private agency or facilitated) adoptions, and intercountry (foreign or Independent international) adoptions. Adoptions $8,000 - $40,000+ Many adoptive parents pay some Facilitated/Unlicensed combination of universal and adoption- Adoptions $5,000 - $40,000+ specific expenses. Many public agencies Intercountry waive home study costs, reimburse most Adoptions $15,000 - $30,000 or all expenses, and offer an adoption subsidy that is up to the foster care payment amount for a qualifying child up until the age of 18 or 21, depending on the child’s While the overall figures may seem characteristics. daunting, prospective adoptive parents should explore all adoption options and the associated costs for each. In some cases,

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the fitness of the parents. Home studies culminate in the social worker’s written Child Welfare Information Gateway report, which includes a recommendation offers a factsheet for parents, Adoption about whether the prospective parents are Options, that describes the different qualified to adopt and, if so, what type of types of adoptions: www.childwelfare. child or children (in terms of characteristics) gov/pubs/f_adoptoption.cfm would be most appropriate (for more information, read Information Gateway’s The Process at www. childwelfare.gov/pubs/f_homstu.cfm). Usually prospective parents pay for the Universal Expenses home study. In the case of public agency adoptions, home study fees may be minimal ($500) or completely waived, although Universal expenses are incurred by everyone parents may incur fees for medical or who adopts a child. (In some cases, they psychological evaluations that could be may be offset by reimbursements or other required. With other types of adoption, resources.) These expenses include home a private agency adoption facilitator may study expenses and court costs. charge $1,000 to $3,000 for the home study. In some cases, the fee for the home study Home Study Expenses may be included in the overall private A home study must be completed for all attorney or private agency fee. Information prospective parents, no matter what type about all fees should be provided in of adoption they intend to pursue.1 In the writing by the agency or social worker, and case of public agency adoptions, these most prospective parents should ask for such often are completed by the local public information. agency or its contractors; for other types of adoption, private agencies or certified Legal Fees social workers conduct the home study. The All domestic adoptions and some purpose of the home study is to prepare intercountry adoptions must be finalized the prospective parents for the adoption, in a court in the United States. Some gather information about them so that intercountry adoptions are finalized in the an appropriate match between the child child’s country of origin. Although not and parents can be made, and evaluate required in these situations, parents often choose also to finalize the placement in a 1 The Information Gateway Glossary defines “home study” U.S. court. All of these procedures in private as a “process of mutually assessing and preparing prospective or intercountry adoption incur a cost. foster, adoptive, or kinship families to determine their suitability to foster or adopt and determine the type of child whose needs In public agency adoptions, most States would best be met by them. A home study may include a range of evaluative activities, visits to the family’s residence, and have a nonrecurring cost allowance that educational activities.” (www.childwelfare.gov/admin/glossary/ should cover all or most of the adoptive glossaryh.cfm)

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parents’ attorney fees. The cost for court Up-front fees and expenses for public document preparation can range from $500 agency adoptions can be as much as to $2,000, while the cost for representing $2,500, including attorney’s fees and travel adoptive parents in an uncontested expenses. In this type of adoption, fees adoption can range from $2,500 to $6,000. often are very low or even waived so that (Again, some or all of these costs may final costs to parents are negligible. In be reimbursable.) In some jurisdictions, some cases, the child may be eligible for adoptions can be finalized without government subsidy payments (often called representation by an attorney. adoption assistance), Supplemental Security Income (SSI), or Medicaid coverage. (These resources are described at the end of this Adoption-Specific factsheet.) Expenses Private Adoption Costs: $5,000 to $40,000 In addition to the costs common to every Private adoption costs vary widely according adoption, adoptive parents generally incur the type of agency used and, sometimes, costs specific to their type of adoption. the individual adoption circumstances. It is The costs for three types of adoption are important for prospective parents to fully described here: public agency, domestic understand what is included in private private agency, and intercountry. These agency, adoption facilitator, and attorney expenses are in addition to the universal fees. In some cases, the cost of the home expenses described above in most cases. study is included, rather than broken out Public Agency Adoption Costs: separately. $0 to $2,500 Private adoptions fall into three general Most public agencies place their primary categories, each with its own attendant focus on placing children from the foster costs: care system, although some also place Licensed Private Agency Adoption voluntarily relinquished infants. Many Costs: Approximately $5,000 to children in foster care may be defined as $40,000. Costs for this type of adoption having special needs, a category that is include a fee charged by the agency and defined differently in each State but may may also include the cost of the home refer to children who must be placed with study, birth parent counseling, adoptive siblings, who are older or in a minority parent preparation and training, and group, or those with disabilities. To social work services involved in matching read more about definitions of “special a child to a prospective family. The fees needs,” see Information Gateway’s “Special charged by licensed agencies are generally Needs” Adoption: What Does It Mean? at consistent within a range, and some even www.childwelfare.gov/pubs/factsheets/ have sliding fee scales based on family specialneeds income. In addition, some agencies

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may offer reduced fees to prospective generally the same as costs of licensed parents who locate a birth parent on their agencies. However, in States that allow own but who seek out the agency for adoptive placements by facilitators, these counseling, facilitation, home study, and placements are largely unregulated. This supervision services. means there is no regulation in terms of the services provided or the expertise of Independent Adoption Costs: the facilitator. Prospective parents may Approximately $8,000 to $40,000 have no recourse if the adoption does not (average is $10,000 to $15,000). proceed as expected. Independent adoptions handled by an attorney generally result in costs that Intercountry Adoption Costs: may include medical expenses for the birth mother (as allowed by law) as well Approximately $15,000 to $30,000 as separate legal fees for representing Agencies that provide intercountry adoptive and birth parents. Allowable adoption services charge fees that may fees for advertising may also be included. range from $15,000 to $30,000. These fees Additional medical expenses may be generally include dossier and immigration required in situations in which there are processing and court costs. In some cases, birth complications. they include a required donation to the foreign or agency.2 Overall costs State laws restrict many of these costs, can be affected by the type of entity in the including any reimbursements to the country that is responsible for placing the birth mother. Restrictions may also child (e.g., government agency, government exist regarding advertisements seeking orphanage, charitable foundation, attorney, expectant parents. Where allowed, such facilitator, or some combination thereof). advertising expenses may range from Many intercountry adoption agencies $500 to $5,000. The Information Gateway do offer a sliding fee scale based on the publication Regulation of Private Domestic adoptive parents’ income. Adoption Expenses has more information about State laws regulating these types of Depending on the country, there can be adoption expenses: additional costs, such as: www.childwelfare.gov/systemwide/laws_ • Child foster care (usually in South and policies/statutes/expenses.cfm Central American adoptions) Compared to licensed agency adoptions, • Parents’ travel and in-country stay(s) to the costs of independent adoptions may process the adoption abroad be less predictable and have been known to be much more than $40,000. In • Escorting fees, charged when parents addition, costs may not be reimbursable do not travel but instead hire escorts to in cases in which a birth mother changes accompany the child on the flight her mind and chooses to parent her child.

2 Facilitated/Unlicensed Adoption Costs: See Information Gateway’s glossary for a definition of “dossier” in adoption: www.childwelfare.gov/admin/glossary/ $5,000 to $40,000. These costs are glossaryd.cfm

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• Child’s medical care and treatment tax credit (an amount subtracted from (occasionally in South and Central their tax liability). They may also be America) able to exclude from their income some amounts paid to them or for them by • Translation fees their employer under a qualified adoption • Foreign attorney fees assistance program. Find information about tax credits and tax exclusion for • Foreign agency fees adoption at the IRS website: www.irs.gov/ • Passport fees taxtopics/tc607.html • Visa processing fees and costs of visa The 2010 passage of the Affordable Care medical examination Act (P.L. 111-148) revised the adoption tax credit by: Resources to Help • Extending the credit’s expiration date • Increasing the maximum adoption Defray Adoption Costs credit and the amount that can be excluded from income In many cases, tax credits, subsidies, • Making the adoption credit refundable, employer benefits, and loans or grants can which can reduce tax liability and help with adoption costs. potentially result in an IRS refund if the credit exceeds the liability Tax Credits The IRS offers frequently asked questions Adoption tax credits may be available to and answers about adoption taxes credits, defray some adoption costs. The amount exclusions, and refundable credits for may depend on family income, whether adoption on its website: the child is designated as “special needs,” www.irs.gov/individuals/ 3 and any other adoption benefits. Parents article/0,,id=231663,00.html may want to check with a tax professional to determine applicable benefits. With Parents also should find out about the the passage of the Fostering Connections IRS adoption taxpayer identification to Success and Increasing Adoption Act number (www.irs.gov/individuals/ of 2008, States are required to inform article/0,,id=96452,00.html), which is any individual who is adopting of their used for temporary identification when eligibility for the adoption tax credit. adopting taxpayers do not have the child’s Social Security number. Federal Tax Credits, Tax Exclusion, and Refundable Credits. Prospective adoptive State tax credits. Several States have parents may qualify for an adoption enacted tax credits for families adopting children from the public child welfare 3 To read more about definitions of “special needs,” see Information Gateway’s “Special Needs” Adoption: What Does It Mean? at www.childwelfare.gov/pubs/factsheets/specialneeds

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system. Some States restrict the credit to Children Adopted From Foster Care provides adoptions from foster care.4 more information on this topic: www.childwelfare.gov/pubs/f_subsid.cfm Subsidies and Reimbursements for Children With Special Needs Employer Benefits Definitions of children with special needs Many employers provide a range of benefits vary for each State, but they often include for families that adopt, such as paid or children who are older, have disabilities, unpaid leave when a child arrives in the belong to a minority group, or must be home, reimbursement of some portion placed with siblings. To facilitate the of adoption expenses, and assistance adoption of these children, who often with adoption services. (Corporate are in foster care, States may provide human resource departments can provide reimbursements for some adoption costs, employees with benefit information.) The as well as subsidies for some children. The Information Gateway factsheet Employer- Information Gateway factsheet “Special Provided Adoption Benefits provides more Needs” Adoption: What Does It Mean? information on this topic: provides more information on this topic: www.childwelfare.gov/pubs/f_benefi.cfm www.childwelfare.gov/pubs/factsheets/ specialneeds Adoption Loans and Grants Reimbursement for Adoption Costs. Adoptive parents are sometimes eligible After families have finalized the adoption for a loan or a grant to offset some of their of a child with special needs from the adoption costs. Such programs have specific public child welfare system, they may requirements for types of adoption and may be able to apply for reimbursement give preference to families with the greatest of expenses they paid related to the financial need or those with other specific adoption, including home study fees, factors. Some adoption agencies may travel expenses to see the child, and also have grant programs. More detailed attorney fees. Most States, under a Federal information may be found by checking the match program, offer nonrecurring resources listed below. adoption expenses reimbursements up to a set limit (which cannot exceed $2,000). Subsidies. Federal and State adoption Additional Resources subsidies (or adoption assistance) may be available to help adoptive parents pay for Child Welfare Information Gateway offers the ongoing care of children with special factsheets that pertain to adoption costs: physical, mental, or emotional needs. In addition, some children qualify for SSI • Employer-Provided Adoption Benefits or Medicaid coverage. The Information www.childwelfare.gov/pubs/f_benefi.cfm Gateway factsheet Adoption Assistance for

4 Check your State tax law for the latest information.

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• Adoption Assistance for Children Adopted From Foster Care www.childwelfare.gov/pubs/f_subsid.cfm National Adoption Foundation offers an adoption grant, loan programs, and adoption insurance: www.nafadopt.org National Endowment for Financial Education offers an online booklet on adoption costs: “How to Make Adoption an Affordable Option” www.pueblo.gsa.gov/cic_text/family/ adoption North American Council on Adoptable Children (NACAC) lists State adoption subsidy profiles: www.nacac.org/adoptionsubsidy/ stateprofiles.html NACAC also provides information on tax credits for special needs adoption: www.nacac.org/postadopt/taxcredit.html

Suggest Citation: Child Welfare Information Gateway. (2011). Costs of adopting. Washington, DC: U.S. Department of Health and Human Services, Children’s Bureau.

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