Families who adopted on or after July 1, 2022 are eligible for a refundable tax credit alongside their 2023 tax return.

The Montana Adoption Tax Credit addresses both private adoption and adoptions through foster care. It awards families adopting through private organizations a credit of $5,000 and those who adopt through the state’s foster care system $7,500. Both are one-time credits. 

Rep. Courtney Sprunger, R-Kalispell, carried the legislation creating the tax credit during the 2023 legislative session. She said the bill was crafted with an eye to how expensive the adoption process can be for families. 

“Anyone who knows will tell you that adoption is tremendously difficult – both financially and emotionally,” said Sprunger in a statement. “This credit helps close the gap with the goal of making it possible for more Montana families to grow through adoption.”

The credit applies to children adopted under the age of 18 and any person who is physically or mentally incapable of self care. The credit, according to Sprunger, will help offset a portion of the financial burden by allowing families to focus more on finding and utilizing resources to integrate a child into their home.

Gov. Greg Gianforte’s Policy Director Glenn Oppel testified on behalf of the governor in support of the bill during the legislative session — an adoption credit was included in Gianforte’s budget proposal. According to Oppel, Sprunger volunteered to carry the bill.

National estimates place the cost of providing for a child in foster care at $15,000 a year. According to a 2015 study by the National Council for Adoption, taxpayers save about $15,500 in state and federal expenditures for each child adopted out of the foster care system.

“Though the adoption tax credit does not offset the full expense families incur when adopting, the assistance is an important part of making adoption more accessible and reducing the number of Montana children who age out of the system without a support network,” Sprunger said in a statement. 

Families wishing to submit for the adoption tax credit should talk with their tax professional or visit https://rb.gy/5kro1i for more information.

Kate Heston can be reached at [email protected] or 758-4459.