Provides for a tax deduction for the adoption of a child with special needs

4 Co-sponsors

• Fredrick J. Akshar II
• Rich Funke
• Andrew J. Lanza
• Kathleen A. Marchione

Title of bill

An act to amend the tax law, in relation to establishing a tax deduction for the adoption of a child with special needs

Purpose

To grant an individual taxpayer a deduction for fees incurred through the adoption of a child with special needs.

Summary of provisions

This bill would establish an individual taxpayer deduction of ten thousand dollars for the adoption of a child with special needs, under the age of eighteen who possesses a specific physical, mental, or emotional condition or disability of such severity or kind that it constitutes an obstacle to the child's adoption.

Justification

Currently, New York State has over 23,000 children in custody in its foster care system. For a large number of these children, returning to their natural parents is impossible. In 2011, there were over 6,400 foster care children waiting to be adopted and the median years each has to wait to be adopted is close to 4.5 years. At an annual cost to New York State of over $33,000 per child in state custody, it is obvious that New York State government must do more to create incentives for families interested in adopting a child in the foster care system. Children with special needs constitute a special problem for adoption.

New York State has recognized the need to provide incentives for the adoption of children with special needs by providing a subsidy of up to $2,000 for non-recurring adoption expenses. In addition, at the federal level, there is a federal adoption tax credit for all adoptions which allows those adopting a special needs child with the maximum allowable deduction, regardless of qualified adoption expenses.

This legislation would give adoptive families a state income tax deduction as well, for adopting a child with special needs. New York must do more to place children with special needs in healthy, loving and nurturing home environments.

At a total annual cost of over $759 million dollars to maintain the 23,000 in state custody, it is clearly in the best interest of these children and to New York taxpayers to create incentives to reduce the number of children in government custody. Public policy that effectively encourages adoption, and especially adoption of children with special needs is beneficial to taxpayers who already have many hurdles to face in adopting a special needs child.

Legislative history

This is a new bill.

Fiscal implications

To be determined.

Effective date

This act shall take effect immediately and shall apply to adoptions in taxable years beginning on and after January 1, 2016.