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Tax credit misses mark in adoptions within Missouri

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    Tax credit misses mark in adoptions within Missouri
    By Matt Franck
    Post-Dispatch Jefferson City Bureau
    JEFFERSON CITY - Just a fraction of the extra $2 million set aside this
    year to promote the adoption of Missouri children has been claimed,
    prompting some to question whether the tax credits should be restructured.

    Lawmakers this year doubled from $2 million to $4 million the amount of tax
    credits to families who adopt children with special needs.

    Half is earmarked for parents who adopt children from overseas. The other
    half goes toward adoptions within the state, as part of an effort to
    encourage families to open their homes to foster children.

    But the Missouri Department of Revenue says just $244,792 of the $2 million
    for such adoptions has been claimed so far this fiscal year. Some adoption
    experts say participation is low because the tax credits don't cover the
    kinds of expenses that parents typically face when they adopt foster

    Parents who adopt children overseas, meanwhile, continue to line up for the
    tax credits. Since July 1, nearly 1,000 such parents have applied - so many,
    in fact, that none of those applicants will receive their entire tax credit.

    Offering a tax credit that pleases parents of both Missouri and
    international children has been a puzzle for lawmakers.

    In the past, both groups of parents have complained that the tax credits are
    gobbled up within days of becoming available. The credits cover up to
    $10,000 in adoption expenses and are regarded as the most generous in the
    nation. But last year, hundreds of eligible taxpayers were turned away when
    the money ran out.

    Lawmakers spent the extra $2 million this year to avoid that problem but
    admit now that the tax credit still needs revising.

    "It isn't a 100 percent solution," said House Speaker Catherine Hanaway, who
    drafted the tax credit revisions this year.

    Hanaway, R-Warson Woods, said the tax credit as it's structured may not be
    that appealing to parents who adopt foster children. That's because the tax
    credits only cover one-time expenses, such as legal fees and transportation.
    Those expenses are already reimbursed by the state in most circumstances.

    Melanie Scheetz, who heads the Foster and Adoptive Care Coalition of
    Missouri, has long called for the credits to cover a broader range of
    expenses, such as home renovations or purchase of a larger car. Beyond that,
    she said, she'd like the credits to cover continuing expenses, like clothing
    and education.

    Scheetz said research by her office suggests that families who adopt foster
    children need the financial support. Most of those families, she said, earn
    less than $35,000 a year.

    Parents who adopt internationally, meanwhile, appreciate the tax credit,
    even though high demand has made them unable to fully benefit. Legal and
    travel fees for such adoptions often exceed $20,000.

    "I doubt you'll find many complaints among parents who adopt
    internationally," said Cory Barron, a spokesman for the adoption agency
    Children's Hope International.

    Barron said the tax credit as it is structured this year is an improvement,
    since it guarantees that all eligible taxpayers will get at least a portion
    of the credit.

    So far this year, parents who adopted internationally have requested $2.6
    million in tax relief. Under the new law, they will be limited to $2 million
    collectively. Even so, it appears parents will receive at least two-thirds
    of their tax credits.

    In the meantime, most of the $2 million set aside for Missouri adoptions
    will likely remain unspent. And that has people like Scheetz worried that
    the funds could be cut from the budget next year.

    Hanaway, who is leaving the Legislature to run for secretary of state, said
    she'd like lawmakers to redirect the unspent tax credits in a way that
    supports families who adopt foster children.

    "I would like to see (the money) stay in the realm of foster and adoptive
    care," she said.

    Reporter Matthew Franck
    E-mail: [email protected]
    Phone: 573-635-6178

    __________________________________________________ ________________ Kari-Lyn
    Bjorn "You don't love someone because they are beautiful, they are beautiful
    because you love them." - Anon.

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