Baby Boomer Generation: Important Tax News for You Regarding Adoptions and Seniors!

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As a grandmother, I am richly blessed with love and hugs from a wide variety of grandchildren, including some with special needs as well as some who have been adopted. They are all such joys and delights and true gifts from God. This week, I heard about an extra gift from God, via the federal government, for those families who have adopted in the last few years. Since we all know that there can be many extra expenses for those caring for the elderly parents in their family as well as babysitting grandchildren, I wanted to make sure I let you know about this, in case it can help you or others in your family.

I don’t know specifics and wouldn’t go into them if I did, as I am definitely NOT a tax expert, but basically, the government has made changes and modifications to the tax code that truly are a blessing to those who have adopted in the last 5-10 years. Again, I’m not sure about the exact amount of days, and I don’t know how it impacts out of country vs. in America adoptions. But one dear friend who has children adopted both ways was blessed wonderfully for each, so it’s VERY definitely well worth checking into.

There are several sites with opinions and explanations about the tax changes, but I would personally recommend you start with the IRS – both on the web and via telephone. I do know that if you use TurboTax (our personal favorite tax software – I’ve been using it since it first came out for the Mac – I think it’s been at least 15 years, maybe longer 🙂 – talk about a vintage baby boomer! ), it does calculate the adoption credits. And it looks like those wonderful people who adopt special needs children will get extra benefits – what a blessing, indeed!

Here’s the info from the IRS. Just  click here or at the end to go to the full page:

What is the adoption credit?

The adoption tax credit offsets qualified adoption expenses making adoption possible for some families who could not otherwise afford it. Taxpayers who adopt a child may qualify for an enhanced adoption tax credit for the years 2010 and 2011.

You may qualify for the adoption credit if you adopted or attempted to adopt a child and paid qualified expenses relating to the adoption. The amount of the tax credit is as much as $13,170 for 2010. You may be able to claim the credit even if the adoption does not become final. If you adopt a special needs child, you may qualify for the full amount of the adoption credit even if you paid few or no adoption-related expenses.

 

The start of the 2011 filing season will begin in January for the majority of taxpayers. However, last week’s changes in the law mean that the IRS will need to reprogram its processing systems for three provisions that were extended in the Tax Relief, Unemployment Insurance Reauthorization and Job Creation Act of 2010 that became law on Dec. 17.

People claiming any of these three items — involving the state and local sales tax deduction, higher education tuition and fees deduction and educator expenses deduction as well as those taxpayers who itemize deductions on Form 1040 Schedule A — will need to wait to file their tax returns until tax processing systems are ready, which the IRS estimates will be in mid- to late February.

“The majority of taxpayers will be able to fill out their tax returns and file them as they normally do,” said IRS Commissioner Doug Shulman. “We will do everything we can to minimize the impact of recent tax law changes on other taxpayers. The IRS will work through the holidays and into the New Year to get our systems reprogrammed and ensure taxpayers have a smooth tax season.” 

We baby boomers in the Sandwich Generation need all the tax help we can get, so I’m glad for occasions like this when I get to share good news with you! And speaking of good news for boomers, as well as our seniors we love – if you have any questions or concerns for your own taxes, or issues that may arise while you are caring for your elderly parents and helping them with their taxes, do be sure to call the IRS for help. I’ve had to do that several times over the years, while helping senior relatives and parents, and they’ve always been so gracious and helpful! Here’s some great IRS Tax Resource links for the Sandwich Generation:

• Contact information for the IRS
• IRS home page
• Products, such as publications and forms) for Retirees and Senior Citizens