How to Claim Pre-Adoptive Children on Tax Returns
Claiming a pre-adoptive child on your tax returns is similar to claiming any child who is a member of the family. Make sure the child has proper documentation such as a social security number. Ensure that the pre-adoptive child meets all the tests for eligibility so you can take the correct deductions for tax relief related to child care expenses. Follow IRS guidelines for deductions and exemptions. Foster parents who are planning to adopt their child should not take business deductions related to the care of the child.
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Things You'll Need
- Proof of residency (optional)
- Documentation for the child
- Expense receipts
- Proof of child care (optional)
- IRS Publication 501
- IRS Form 1040
Instructions
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Obtain social security numbers for the pre-adoptive children. Obtain a birth certificate through the local county website and then take the birth certificate to a local social security administration office. Present the certificate to the clerk and complete an application. Follow the Social Security Administration's advice: "If you want to claim your child for tax purposes while the adoption is still pending, you need to contact the Internal Revenue Service for Form W-7A, Application for Taxpayer Identification Number for Pending U.S. Adoptions."
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Make an agreement with the birth parents, or the social services system, that they will not claim the children on their tax returns for the same period. Check the date the children arrived and make sure they have lived in the household for at least six months. Consult a family law attorney or tax attorney if there is a question about who has legal standing.
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Read the IRS regulations for a "qualifying child" in Publication 501. There are six tests: relationship, age, residency, support, joint return and a special test for a qualifying child of more than one person. Do not claim money used in the care and support of the child as income.
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Write down the dependents' names under "Exemptions" on Form 1040. Write the legal first name, last name, social security number and the relationship. Organize receipts for medical expenses, dental expenses, vision and transportation for medical purposes. Deduct these expenses in the same way you would deduct them for any other member of the family.
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Learn about tax relief for other child care expenses. According to Nolo, this can save a family several thousand dollars. Make sure the child fits the requirements for the child care tax credit and dependent care accounts. Ensure that the child care provider is not someone who can be claimed as a dependent.
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