Adoption Tax Credit Refundability Act of 2025

# Adoption Tax Credit Refundability Act of 2025 — Summary **What the Bill Does** This bill would make the adoption tax credit "refundable," meaning families could receive the full credit amount even if they owe no federal income taxes. Currently, the adoption tax credit is "nonrefundable," so families can only use it to reduce the taxes they owe. If their tax bill is smaller than the credit amount, they lose the unused portion. This change would allow more families to benefit from the full credit, potentially receiving a refund from the government if the credit exceeds their tax liability. **Who It Affects** The bill primarily affects families who adopt children and have lower incomes.

Currently, middle and higher-income families benefit most from the adoption tax credit because they owe enough in taxes to use the full amount. Lower-income families often can't use the entire credit. This bill would help equalize access to the tax benefit across all income levels, making adoption more financially feasible for families with limited resources. **Current Status** As of now, the bill (S 1458) is in committee, meaning it has been introduced but has not yet been debated or voted on by the full Senate.