Question

betty and gliria adopted child in fore adoption. they had $10,000 in adoption espenses, and the adoption was finalized January 15, 2019. their modified adjusted groos incomefor 2019 was $ 214,500. how much can they claim for the adoptioncredit in 2019 ?

Answer 1

For tax year 2019, the MAGI phaseout begins at $211,160 and ends at $251,160. Thus, if your MAGI amount is below $211,160 for 2019, your credit or exclusion won't be affected by the MAGI phaseout, whereas if your MAGI amount for 2019 is $251,160 or more, your credit or exclusion will be zero.

In this case Modified Adjusted Groos Income(MAGI) is $ 214,500. so they are eligible for adoption credit.

For 2019 adoptions (claimed in early 2020), the maximum adoption credit and exclusion is $14,080 per child.You must reduce the dollar limit for a particular year by the amount of qualified adoption expenses paid and claimed in previous years for the same adoption effort.

So the adoption credit in 2019 is is $14080-$10000=$4080