Embryo Adoption and the Adoption Tax Credit

April 15th is Tax Day!*

Filing your taxes can be a stressful time of the year. But understanding what you can credit or deduct can help make the process a bit smoother. There are many ways you may be able to reduce your tax burden—charitable donations, interest payments, education fees, dependents living in your home, and of course the adoption credit!

Since embryo adoption is not governed under adoption law (it's governed under property law) is your family eligible for the adoption tax credit?

According to Creating a Family, families are eligible for the adoption tax credit if they adopted a child and paid out-of-pocket expenses necessary to the adoption in that year. Since embryos are not considered “persons” in every state, the tax credit cannot be claimed if no baby has been born.

We have heard of families who have been able to receive the tax credit once the baby has been born. The families who have successfully claimed the ATC for their embryo adoption have usually finalized their adoption in court, expending additional dollars to have an attorney assist them. Finalizing your embryo adoption in court is not legally necessary—you have already been identified as the legal parents on your baby’s birth certificate. However, having a court confirm that your baby is an adopted child seems to be the lynchpin in applying for the ATC. One state, Georgia, allows embryo adopting families to finalize their adoption in the court, but you still need to secure the services of an attorney to do so.

We have also heard of families who have applied and haven’t received the tax credit. We would encourage you to talk to your CPA and an adoption attorney about the possibility of the tax credit and they would likely be able to point you in the right direction of an answer.

To learn more about embryo donation and adoption, visit EmbryoAdoption.org.

*Historically, April 15th is the official deadline for Americans to submit their federal tax documents to the IRS. However this year, due to the COVID-19 pandemic, the deadline has been extended to July 15th.