House Democratic Caucus Leader Rocky Adkins (D-Sandy Hook), today filed House Bill 295, legislation to create a Kentucky income tax credit to offset adoption costs.
“I have had a number of constituents approach me about ways to offset the cost of adopting, which can be very expensive,” said Adkins. “Costs such as adoption agency, court and attorney fees and travel expenses can easily run into tens of thousands of dollars. There is already a federal adoption tax credit to help offset these expenses, and the addition of a state adoption income tax credit will provide additional assistance to the many Kentucky families wanting to adopt.”
The credit authorized in HB 295 is largely modeled after the federal adoption tax credit. Allowable expenses are defined under federal law, and the state law credit is equal to 20 percent of the federal credit.
The credit offsets an individual’s income tax up to the amount of the year’s tax liability, but the difference between the amount of the credit and that tax liability may be carried forward for five years. This means that the taxpayer may claim the credit against future year taxes until the amount of the credit is exhausted or until the five years have passed, whichever comes first.
“Families adopt for many reasons,” said Rep. Adkins. “Whatever the reason, the decision to adopt is often a sacrifice on a number of levels, not the least of which is financial. I hope that this bill, if enacted, would encourage more families to adopt by providing a modest offset of the very significant costs they bear.
House Bill 295 will be referred to a House Standing Committee, most likely the Committee on Appropriations and Revenue, within the next week, where it may be considered for referral to the House Floor for passage.
Rep. Rocky Adkins represents Elliott, Lewis and Rowan Counties in the 99th House District.
Story provided by: Kentucky.org