Sen. Tim Johnson (D-South Dakota). Photo from Facebook
A bipartisan group of lawmakers introduced a bill to ensure adoptive parents in Indian Country can receive a tax credit for taking children with special needs.
Congress adopted the tax credit in 1996 to ease the financial burden for parents who adopt children that have been designated by state governments as having special needs. However, it does not recognize when a tribal government does the same.
The Tribal Adoption Parity Act changes that. It amends the Internal Revenue Code to provide equal treatment for adoptive parents who take on special needs children through tribal courts.
“The Tribal Adoption Parity Act will provide financial relief for families in South Dakota by making it easier for adoptive parents in Indian Country to claim the full adoption tax credit,” Sen. Tim Johnson (D-South Dakota), one of the sponsors of the bill, said in a press release. “It is unacceptable that parents who adopt an Indian child through a tribal court are prevented from accessing the financial relief that is provided to adoptive families in non-tribal areas. This bill addresses an oversight in our tax code by ensuring that adoptive parents throughout Indian Country receive fair tax treatment.”
The Taxpayer Advocate Service -- an independent organization within the Internal Revenue Service -- has endorsed the change.
A 2012 report to Congress noted that tribes possess exclusive jurisdiction under the Indian Child Welfare Act to make determinations regarding Indian children.
"Current law harms Native American children with special needs by increasing the cost of their adoptions relative to similarly situated special needs children in states," the report observed.
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Press Release: Senator Johnson Introduces Legislation to Help Adoptive Parents in Indian Country Receive Adoption Tax Credit
(Sen. Tim Johnson 7/9)