How this calculator works
Tax year: 2026, United States. Qualified adoption expenses of up to $17,670 per child produce the credit, and a special needs adoption can claim the full amount without expenses. The credit is reduced above $265,080 of modified adjusted gross income by the share of the next $40,000, and it reaches zero at $305,080. For 2026 the law makes up to $5,120 of the credit per child refundable, so part of it can be paid even when it exceeds the tax owed; the rest is nonrefundable and any unused nonrefundable amount can be carried forward for up to five years. The model leaves out the special needs rule, the five-year carryforward, the distinction between domestic and foreign adoptions, the treatment of employer-provided adoption assistance, the year the expenses are treated as paid and any state credit.
Formula
Credit before phase-out = min(qualified expenses, $17,670) x children. Phase-out reduction = credit before phase-out x min(1, max(0, modified adjusted gross income - $265,080) / $40,000). Credit = credit before phase-out - reduction. Refundable portion = min(credit, $5,120 x children). Nonrefundable portion = credit - refundable portion.
Worked example
One child, $10,000 of qualified expenses and $285,080 of modified adjusted gross income. The credit before phase-out is $10,000 and income is halfway through the $40,000 range, so half is removed. The credit is $5,000, all of which is within the $5,120 refundable cap, so the refundable portion is $5,000 and the nonrefundable portion is zero.
Frequently asked questions
How much is the adoption tax credit in 2026?
Up to $17,670 per child for 2026, up from $17,280 in 2025. The amount is based on qualified adoption expenses, subject to the income phase-out.
Is the adoption credit refundable?
For 2026, up to $5,120 per child is refundable. The remainder is nonrefundable and can offset tax, with unused amounts carried forward for up to five years.
What is the income limit for the adoption credit?
The credit begins to phase out at $265,080 of modified adjusted gross income and is fully phased out at $305,080 for 2026.
Do I need expenses to claim the credit for a special needs adoption?
No. A special needs adoption can claim the full $17,670 even when qualified expenses are lower or zero, subject to the same income phase-out. That rule is not modelled here.