Push to increase foster care adoption tax credits could cost Georgia $4.8M

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A measure that would increase foster care adoption tax credits could result in a state revenue loss of $4.8 million over the next five years, according to fiscal researchers.

House Bill 114, introduced by Rep. Bert Reeves, R-Marietta, would increase the annual tax incentive for adopting a foster child from $2,000 to $6,000. According to a fiscal note from the Department of Audits and Accounts, the proposal could decrease state tax revenues by $400,000 in fiscal year 2022 and grow to up to $1.5 million by fiscal year 2026.

Reeves and supporters of the bill said it’s meant to promote more adoptions in the state. According to Reeves, the average foster care adoption tax credit issued is $1,945, below the current threshold. He hopes the legislation would entice Georgians in higher income brackets to adopt foster children.

“We’re trying to figure out how to help,” Reeves told the House Committee on Ways & Means on Thursday. “It’s not really an incentive, so to speak. You don’t want to incentivize somebody to do something that needs to be a calling.”

HB 114 increases the tax credit to $6,000 for only the first five years after the 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 Division of Family & Children Services. There are nearly 150 foster children up for adoption on Georgia’s Adoption Photolisting website.

Gov. Brian Kemp continuously has pushed to increase the tax incentive for foster care adoption and recently rallied for another proposal to increase adoptions. Kemp has expressed support for House Bill 154, which would lower the required age to adopt from 25 years old to 21. Kemp said it would make it easier for close relatives to adopt children out of foster care.

“It is our solemn duty, as elected leaders who long to see our children grow and thrive in a sometimes dark and dangerous world, to take meaningful action,” Kemp said. “By making it more affordable to adopt, reducing bureaucratic red tape that stands in the way of loved ones adopting kids, and championing the safety of children across our state, we can ensure Georgia’s children are placed in those homes and secure a safer, brighter future for generations to come.”

HB 114 was approved by the House Committee on Ways & Means on Thursday, but the House Committee on Rules still must approve it before a full House vote. The bill then must be approved in both chambers before it is sent to Kemp.

Corey Burres, vice president of communications for the nonpartisan think tank Georgia Center for Opportunity, said “foster care and adoption are crucial parts of” creating “flourishing communities.”

“These bills are a great first step forward in helping the thousands of Georgia kids waiting to be adopted each year,” said Burres, who also is a respite foster care parent. “We hope to see the foster community empowered through the current legislative session, so all of Georgia’s children can flourish – no matter their circumstances.”

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