[lovemyrose]

I'm sorry if this is a repeat question...but, I am at work and I don't have time to read down the list right now.

Anyway...here's the deal:

My husband and I are currently waiting to be chosen by birthparents. We paid our agency's required $1,000.00 homestudy fee back in March this year. But, even if we are placed with a baby before December 31st, our adoption will not be final until at least June, 2004 (our state has a 6-month waiting period before finalization).

So...my question is this -- when can I put that $1,000.00 toward our "qualified adoption expenses"? Because it clearly states that expenses must be claimed in the same year they are paid; however, nothing can be claimed until the year the adoption is finalized. So, do I just have to eat that $1,000.00??

Please let me know if anyone can help out with this one!! I've read through the instructions for the form, but my question just can't be answered there. [Should I just call an accountant?]

Thanks for your time! =)
Amy

[tobeafamily]

You would apply this $1000 plus any other expenses in the year you finalize. We had 'split year' expenses, half in 2001, half in 2002, and were able to claim all in 2002.

Now, if you didn't finalize in 2004, you would need to wait until 2005 to claim this as an adoption expense for a non-completed situation.

HTH, you should also check with your CPA.

Regina, AMom to Ryan Joshua Thomas

[lovemyrose]

Regina,
Thanks for your reply. So, now matter when you spend the money, it all gets deducted (or applied or whatever) the year you finalize. So, the IRS doesn't care about what year you SPENT the money, just the year you CLAIM the expenses?

Thanks again! =)

[tobeafamily]

Correct - as long as you finalize. If you don't ever finalize, then they do care when the money was spent.

:-)

Regina