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Jumping in later here, but just wanted to say that DianeS is correct on the tax credit laws.
ByChanceBaby,
If you pay $11,000 is 2008 but you have not finalized in 2008, then you must wait until 2009 to claim the credit. Whatever is left over may be carried over. Now, if in 2009 you pay an additional $10,000 AND you finalize in 2009 you will have $21,000 to apply to your tax credit. Now keep in mind that you are only offsetting your tax liability. So you may have alot or a little to carry over for the next few yrs. depending on your liability.
Now if in 2009 you claim what you spent in 2008, you haven't finalized, but you have spent say...$5,000 more. You will have to wait until 2010 to claim the $5000 you spent in 2009 because you did NOT finalize. Does that make sense?
Also, it doesn't matter what the overall cost of the adoption is, as long as you only claim what you actually spent, you can claim it. There is an exception to that rule though....If you adopt a special needs child then you can claim the maximum amount allowed the year you finalize, even if you spent $0 in adoption fees. The child does have to be considered special needs through the courts. Alot of times if you foster adopt, that child is considered to be special needs even if there is really no physical problem....Just food for thought!
Hope this helped!
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