Question

Indiana Adoption Tax Credit CARRY FORWARD

Forum|Forum|5 years ago
March 31, 2021
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I had expenses from an adoption of 2 brothers i did not complete in 2016 and a completed adoption in 2018. I have a $19,000 credit I have carried forward on my federal return because I have not had tax liability to use yet. However, in Indiana for 2020 taxes, I do have some relative to retirement funds disbursement. So I'm in the state TT interview, and it wants data from all the 8839's going back to 206 for all 3 kids. It is asking for the numbers from lines 11 and 12 on the 8839, which seem to be focused on current year adoption expenses only.

Yet Indiana Information Bulletin #111 states: "f all or part of the federal credit for a taxable year beginning after Dec. 31, 2014, is required to be claimed in or carried forward to a taxable year after the taxable year in which the credit is first allowed as a credit , the credit shall be allowable for Indiana purposes." I should be eligible, I think, for up to $1,000 for each child.

It doesn't seem to matter how I load the data in, the TT software keeps telling me I am ineligible for this credit, which makes me wonder if there is a glitch in the software and maybe I should abandon it and do the Indiana manually on paper? Thanks so much!

E

ErnieS0

The Indiana Adoption Credit is based on the federal credit. If you are not able claim the credit on federal because you had no tax liability, then Indiana will not allow you to claim a credit.

Indiana says:

You may be eligible to claim an adoption credit on your state tax return if you claimed an adoption credit on your federal tax return. The amount of the credit may be as much as 10 percent of the federal credit allowed per child, or $1,000 per child, whichever is less.

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