Adoption tax credit boost heads to Kemp for approval
(The Center Square) – A bill to increase foster care adoption tax credits in Georgia is on its way to Gov. Brian Kemp.
House Bill 114, which unanimously passed the Senate, 53-0, on Thursday without debate, increases the annual tax incentive for adopting a foster child from $2,000 to $6,000.
Kemp pushed the legislation, which he hopes encourages more Georgians to adopt foster children. It has received full bipartisan support from the General Assembly.
“The purpose of this bill is to incentivize foster child adoptions because the cost associated with raising a child from the foster care system is oftentimes more expensive,” said Sen. Bo Hatchett, R-Cornelia, who presented the bill Thursday.
Officials estimate the measure could result in a state revenue loss of $4.8 million over the next five years. Some supporters of the measure said it would reduce public foster care cost.
According to a fiscal note from the Department of Audits and Accounts, if HB 114 becomes law, it could decrease state tax revenues by $400,000 in fiscal year 2022 and up to $1.5 million by fiscal year 2026.
The average foster care adoption tax credit issued is $1,945, below the current threshold, lawmakers said.
HB 114 increases the tax credit to $6,000 for only the first five years after a child’s adoption. Parents would continue to receive a $2,000 tax credit until the child turns 18 years old. The credit cannot be more than what the taxpayer owes during the tax year. The bill also eliminates the carry-forward of new credits under current law.
Georgia had about 12,096 children in foster care at the beginning of February, according to the Georgia Division of Family & Children Services. The state will spend $516 million on child welfare, foster care and adoption services in fiscal year 2021, the Georgia Budget Policy Institute said.
There are nearly 140 foster children up for adoption on Georgia’s Adoption Photolisting website. Hatchett said the measure could “make a difference for those children that are oftentimes forgotten.”
The bill cleared the House, 158-0, on March 8.
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