Adoption Assistance Program (AAP):
This entitlement program was created to provide
financial and medical coverage to facilitate the adoption of children who otherwise
would remain in long-term foster care. AAP eligible children may receive federally
funded benefits that may include: monthly negotiated rate, medical coverage,
reimbursement of nonrecurring adoption expenses (up to $400 per child per adoption),
payment for an eligible out of home placement, payment for eligible Wraparound
services, aid regardless of the adoptive family's state or country of residence, and if
eligible, benefits may continue to age 21. Do not finalize an adoption of a child from
foster care until you have an AAP agreement in writing from the child's agency.
For more information, or more information on other states, please refer to the Child
Welfare Information Gateway:
Federal Adoption Tax Credit
The Federal Adoption Tax Credit helps offset the costs of adoption and allows more
families to afford adoption and provides children with permanent families. This credit
applies to all types of adoptions (except step-parent adoption). Families who adopt
children with special needs can claim the maximum credit regardless of whether they
have qualified adoption expenses or not. A special needs adoption is one in which the
state or county child welfare agency has determined that the child is not likely to be
adopted unless the government provides assistance to the adoptive family. The special
needs determination is almost exclusively for children in foster care. Children who are
determines to be special needs are typically older, are part of a sibling group that will be
placed together with one family, or have physical, emotional, or mental disabilities. All
children adopted from the foster care system with an Adoption Assistance agreement
from their state or county are considered special needs for tax credit purposes.
Refer to the IRS for more informationand for formal
legal guidance: Adoption Tax Credit
