California Adoption Credit
The Adoption Tax Credit is a valuable benefit for families adopting a child who was a citizen or legal resident of the United States and in the custody of a California public agency or a California political subdivision. The credit 50% of the adoption cost.
Eligibility
Your credit is limited to a amount per year per minor child set by the board. For the year 2008, the limit is $2,500. Carry over the excess credit to future years until the credit is used.
(Non)Refundable
Refundable
How To Claim
You claim the credit in Form 540 by entering Adoption credit and Code 197 line 25/26. Use the worksheet to figure out the credit amount if needed.
Additional Info
Many states provide reimbursement of a certain amount of non-recurring adoption expenses, Be sure to check with your state tax office, The credit of $10,960 is per child, not per year, so even if you claim expenses paid out over more than one year for one adoption, the total credit amount remains $10,960
Adoption Credit