§ 40-18-361 — Tax Credit for Certain Adoptions

(a) A taxpayer shall be allowed a one time, refundable credit against the tax imposed by Section 40-18-2, for a private adoption or the adoption of a qualified foster child until December 31, 2022. The amount of such credit shall be one thousand dollars ($1,000) per child adopted through a private adoption or qualified foster child to be claimed in the year in which the adoption becomes final.
(b)(1) For tax years beginning on and after January 1, 2023, and ending December 31, 2027, a taxpayer shall be allowed a one time, refundable credit against the tax imposed by Section 40-18-2, for a private adoption, an out-of-state adoption, or the adoption of a qualified foster child. The credit may be claimed in the year in which the adoption becomes final.
(2) The amount of the credit shall be two thousand dollars ($2,000) per child adopted through a private adoption or per the adoption of a qualified foster child, provided that the adopted child is a resident of Alabama.
(3) If the child is adopted through an out-of-state adoption or is not otherwise a resident of Alabama, the amount of the credit shall be one thousand dollars ($1,000) per child.
(c) A taxpayer who adopts a child of his or her spouse is not eligible for a tax credit under this section.
(d) For tax years beginning on and after January 1, 2028, a taxpayer shall be allowed a one time, refundable credit against the tax imposed by Section 40-18-2, for a private adoption or the adoption of a qualified foster child. The amount of such credit shall be one thousand dollars ($1,000) per child adopted through a private adoption or qualified foster child to be claimed in the year in which the adoption becomes final.

Legislative History

(Act 2014-413, p. 1517, §2; Act 2018-549, §1; Act 2022-299, §1.)