2018 Adoption Credit
For 2018, the Adoption Credit is $13,810 (Maximum credit), $207,140 (Phase-out threshold) and $247,140 (Fully phased out).
Effective 2018-01-01Source: Rev. Proc. 2018-18 (Internal Revenue Bulletin 2018-10) (IRS)Verified 2026-08-29
Compared with 2017
| Item | 2017 | 2018 | Change |
|---|---|---|---|
| Maximum credit | $13,570 | $13,810 | +$240 (+1.8%) |
| Phase-out threshold | $203,540 | $207,140 | +$3,600 (+1.8%) |
| Fully phased out | $243,540 | $247,140 | +$3,600 (+1.5%) |
Who it applies to
Taxpayers who adopted a child or incurred qualified adoption expenses in taxable years beginning in 2018
What changed this year, and why
For taxable years beginning in 2018, the maximum adoption credit is $13,810 per eligible child. The credit phases out for taxpayers with modified adjusted gross income between $207,140 and $247,140.
Common questions
- How much is the adoption credit worth?
- The maximum adoption credit is $13,810 per eligible child for taxable years beginning in 2018. For a child with special needs, the full credit is available regardless of actual expenses. For other adoptions, the credit is limited to qualified adoption expenses up to $13,810.
- Is the adoption credit subject to income limits?
- The credit begins to phase out for taxpayers with modified adjusted gross income above $207,140 and is completely eliminated for those with modified adjusted gross income of $247,140 or more.
The credit shrinks as income rises
The 2018 adoption credit of up to $13,810 per eligible child is reduced for higher-income taxpayers. When your modified adjusted gross income (MAGI) exceeds $207,140, the credit begins to shrink proportionally. The reduction continues as income rises through the phaseout range. Once MAGI reaches $247,140 or more, the credit is eliminated entirely and you cannot claim any amount. Taxpayers with MAGI at or below $207,140 receive the full credit without reduction. The phaseout applies to both the adoption credit and the employer-provided adoption benefits exclusion, using the same income thresholds and the same modified adjusted gross income measure.
2018 maximum credit. The maximum credit and the exclusion for employer-provided benefits are both $13,810 per eligible child in 2018. This amount begins to phase out if you have modified adjusted gross income in excess of $207,140 and is completely phased out for modified adjusted gross income of $247,140 or more.
2018 Instructions for Form 8839, Qualified Adoption Expenses (IRS)
The income limit is measured on modified AGI
The income limit on the adoption credit is measured using modified adjusted gross income, commonly called MAGI. For 2018, the phaseout begins once MAGI exceeds $207,140, and the credit is completely eliminated when MAGI reaches $247,140 or more. Taxpayers with MAGI at or below $207,140 face no reduction and may claim the full credit. Between those two thresholds, the credit shrinks gradually as income rises. The same MAGI-based limit applies to the exclusion for employer-provided adoption benefits. Because MAGI is the measure, not regular adjusted gross income, certain adjustments to your AGI can push you into or out of the phaseout range.
Income limit. The income limit on the adoption credit or exclusion is based on modified adjusted gross income (MAGI).
2018 Instructions for Form 8839, Qualified Adoption Expenses (IRS)
The credit and the employer exclusion cannot cover the same expense
When you pay qualified adoption expenses, you may be eligible for both a tax credit and an exclusion for employer-provided adoption benefits. However, you cannot claim both benefits for the same dollar of expenses. If your employer pays or reimburses part of your adoption costs, that amount can be excluded from your income, but you cannot also take a credit against those same dollars. You may still use the credit for other qualified expenses you paid out of pocket. This rule prevents double-dipping by ensuring each dollar of expense supports only one tax benefit. Both the credit and the exclusion are capped at $13,810 per eligible child in 2018.
But, you can't claim both a credit and exclusion for the same expenses.
2018 Instructions for Form 8839, Qualified Adoption Expenses (IRS)
Unused credit carries forward
If the adoption credit you calculate for 2018 exceeds the tax liability you can offset this year, the unused portion does not disappear. Instead, you may carry the remaining credit forward for up to 5 years, or until it is fully used, whichever occurs first. The amount you can carry forward depends on the difference between the credit you figured and the amount you were able to claim in the current tax year. You must use the Adoption Credit Carryforward Worksheet to calculate the exact amount. Keep the worksheet for your records, as you will need it to figure your credit in future years when you apply the carryforward.
If Form 8839, line 15, is smaller than line 14, you may have an unused credit to carry forward to the next 5 years or until used, whichever comes first.
2018 Instructions for Form 8839, Qualified Adoption Expenses (IRS)
How each figure was verified
Each number below was read from a stored copy of the document named beside it, and checked to occur word for word in the quoted sentence. The digest is of that stored text.
Rev. Proc. 2018-18 (Internal Revenue Bulletin 2018-10) (IRS)
- Maximum credit
under § 23(b)(1) the maximum credit allowed for other adoptions is the amount of qualified adoption expenses up to $13,810.
- Phase-out threshold
The available adoption credit begins to phase out under § 23(b) (2)(A) for taxpayers with modified ad- justed gross income in excess of $207,140
- Fully phased out
The available adoption credit begins to phase out under § 23(b) (2)(A) for taxpayers with modified ad- justed gross income in excess of $207,140 and is completely phased out for taxpayers with modified adjusted gross income of $247,140 or more.