2026 Adoption Credit

Who it applies to

The credit applies to a taxpayer who adopts a child. For an adoption of a child with special needs the credit allowed for taxable years beginning in 2026 is $17,670. For any other adoption, $17,670 is the ceiling: the maximum credit is the amount of qualified adoption expenses up to that figure. Separately, $5,120 of the credit allowed under § 23 may be refundable for 2026, which reaches taxpayers whose tax liability is too small to absorb the whole credit. Income still limits the credit. It begins to phase out under § 23 for taxpayers with modified adjusted gross income above the threshold Rev. Proc. 2025-32 states, and is completely phased out at the higher modified adjusted gross income it also states. Employees receiving employer-paid adoption assistance under § 137 are covered by a separate section of the same revenue procedure, which carries the same $17,670 ceiling.

What changed this year, and why

For taxable years beginning in 2026 the adoption credit under § 23 is $17,670, up from $17,280 for the prior year. The same $17,670 is stated twice: as the credit allowed for an adoption of a child with special needs, and as the ceiling on qualified adoption expenses for any other adoption. The larger change is structural. The One, Big, Beautiful Bill Act added a refundable portion to § 23, and Rev. Proc. 2025-32 sets the amount of the credit that may be refundable at $5,120 for 2026. Rev. Proc. 2025-32 modifies Rev. Proc. 2024-40 and states these items for the Code as in effect on October 9, 2025.

Common questions

How much is the adoption tax credit for 2026?

For taxable years beginning in 2026, Rev. Proc. 2025-32 sets the adoption credit under § 23 at $17,670. That figure is the credit allowed for an adoption of a child with special needs, and it is also the ceiling for any other adoption, where the maximum credit is the amount of qualified adoption expenses up to $17,670. The full ceiling is available only below the income phase-out range.

Is any of the adoption credit refundable in 2026?

Yes, in part. The One, Big, Beautiful Bill Act added a refundable portion to § 23, treating so much of the credit allowed as does not exceed a set amount as refundable, with that amount adjusted for inflation for taxable years beginning after December 31, 2025. Rev. Proc. 2025-32 sets it at $5,120 for taxable years beginning in 2026. The rest of the $17,670 remains nonrefundable.

How much did the adoption credit increase for 2026?

It moved from $17,280 for the prior year to $17,670 for taxable years beginning in 2026. That is the routine inflation adjustment, which Rev. Proc. 2025-32 states is generally determined by reference to § 1(f). The refundable portion of $5,120 is new rather than an increase: it comes from an amendment to § 23 made by the One, Big, Beautiful Bill Act, not from the annual adjustment.

Is the adoption credit different for a child with special needs?

The amount is the same but it is described differently. Under § 23 the credit allowed for an adoption of a child with special needs is $17,670 for taxable years beginning in 2026, stated as the credit itself. For other adoptions, $17,670 is the maximum credit and what can be claimed is the amount of qualified adoption expenses up to that ceiling, so actual spending governs.

Does income affect the adoption credit in 2026?

Yes. The available adoption credit begins to phase out under § 23 for taxpayers with modified adjusted gross income above the threshold Rev. Proc. 2025-32 states for taxable years beginning in 2026, and it is completely phased out at the higher modified adjusted gross income the same section states. Below the lower threshold the whole $17,670 ceiling is available; at or above the higher figure no credit is allowed.

Does employer adoption assistance use the same limit as the credit?

For 2026 the numbers match, but the provisions are separate. The credit is in § 23; the exclusion from an employee's gross income for qualified adoption expenses paid or incurred by an employer under an adoption assistance program is in § 137. Rev. Proc. 2025-32 sets both at $17,670 for taxable years beginning in 2026 and gives both the same modified adjusted gross income phase-out range.

Which tax year do the 2026 adoption credit amounts apply to?

Taxable years beginning in 2026. Rev. Proc. 2025-32 states in its effective date section that its 2026 adjusted items apply to taxable years beginning in 2026, with a separate calendar year rule for a listed set of items that does not include the adoption credit. So a taxpayer whose taxable year is not the calendar year uses $17,670 for the taxable year beginning in 2026.

Where do the 2026 adoption credit figures come from?

From Rev. Proc. 2025-32, which modifies Rev. Proc. 2024-40 to reflect amendments made to the Code by the One, Big, Beautiful Bill Act and sets inflation-adjusted items for 2026 as the Code stood on October 9, 2025. Its adoption credit section states $17,670 and $5,120. The revenue procedure adds that later amendments may require additional guidance to confirm the adjustments still apply.

Every amount on this page is a published figure rather than yours. The Adoption credit after the income phase-out takes the number you enter and works it out against them, showing which published figure it used.