BILL NUMBER:S4121                Revised 3/19/15

TITLE OF BILL:

An act to amend the tax law, in relation to establishing a tax
deduction for the adoption of a child with special needs

PURPOSE:

To grant an individual taxpayer a deduction for fees incurred through
the adoption of a child with special needs.

SUMMARY OF PROVISIONS:

This bill would establish an individual taxpayer deduction of ten
thousand dollars for the adoption of a child with special needs, under
the age of eighteen who possesses a specific physical, mental, or
emotional condition or disability of such severity or kind that it
constitutes an obstacle to the child's adoption.

JUSTIFICATION:

Currently, New York State has over 23,000 children in custody in its
foster care system. For a large number of these children, returning to
their natural parents is impossible. In 2011, there were over 6,400
foster care children waiting to be adopted and the median years each
              

has to wait to be adopted is close to 4.5 years. At an annual cost to
New York State of over $33,000 per child in state custody, it is
obvious that New York State government must do more to create
incentives for families interested in adopting a child in the foster
care system. Children with special needs constitute a special problem
for adoption.

New York state has recognized the need to provide incentives for the
adoption of children with special needs by providing a subsidy of up
to $2,000 for non-recurring adoption expenses. In addition, at the
federal level, there is a federal adoption tax credit for all
adoptions which allows those adopting a special needs child with the
maximum allowable deduction, regardless of qualified adoption
expenses.

This legislation would give adoptive families a state income tax
deduction as well, for adopting a child with special needs. New York
must do more to place children with special needs in healthy, loving
and nurturing home environments.

At a total annual cost of over $759 million dollars to maintain the
23,000 in state custody, it is clearly in the best interest of these
children and to New York taxpayers to create incentives to reduce the
number of children in government custody. Public policy that
effectively encourages adoption, and especially adoption of children
with special needs is beneficial to taxpayers who already have many
hurdles to face in adopting a special needs child.

LEGISLATIVE HISTORY:

This is a new bill.


FISCAL IMPLICATIONS:

To be determined.

EFFECTIVE DATE:

This act shall take effect immediately and shall apply to adoptions in
taxable years beginning on and after January 1, 2015.