One of the first bills on the agenda when the Alabama House of Representatives reconvenes on Tuesday will be Rep. Paul Lee’s, R-Dothan, Adoption Tax Credit bill.
The bill would give Alabama residents who adopt a child either through private adoption or through the state foster care system a one-time $1,000 income tax credit, which would apply in the tax year in which the adoption was finalized.
Approximately 2,500 kids were adopted in Alabama last year.
“We’re trying to take care of Alabama children and get them in a good, stable home,” Rep. Lee told Yellowhammer today.
Lee has firsthand experience with this issue. He and his wife have an adopted daughter, who is now 20-years-old.
But when the bill came up in committee last week, Democrats quickly jumped out against it.
Democrats say the bill will take $2.5 million a year out of the Education Trust Fund, a number they came to after multiplying the tax credit amount by the number of Alabama children adopted last year.
Republicans responded by pointing out that the bill could help ease the financial burden on the Alabama Department of Human Resources. DHR is funded by the Alabama Public Welfare Trust Fund, which receives annual appropriations from both the Education Budget and The General Fund Budget.
“We believe it will actually help us as far as DHR is concerned,” Rep. Lee said. “It’s about $5,000 a year per child that stays in DHR. Getting them out of that system and into permanent homes will help DHR financially. But most importantly, we’re getting these children into a stable home that will help them with their education and the decisions they make for their future. The earlier we can do that, the better.”
Lee said he believes the tax credit will be especially helpful to families adopting in the private sector.
“If you choose to go through the private sector, it can sometimes be hard to tell the total cost because of attorney fees and other expenses that aren’t calculated ahead of time,” Lee said. “This bill will cover both private sector adoptions and the adoption of kids coming out of the DHR system. Thousands of kids and families will benefit from this every year.”
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