It depends on if you claimed a Special Needs Child or not.
A child has special needs for purpose of the adoption expenses if:
- The child is a citizen or resident of the United States or its possessions when the adoption effort began;
- A state determines that the child can't or shouldn't be returned to his or her parent's home; and
- The state determines that the child probably won't be adoptable without assistance provided to the adoptive family.
Don't confuse "children with special needs" for purposes of the adoption credit with the definitions of "children with special needs" for other purposes. Foreign children aren't considered to have special needs for purposes of the adoption credit. Even U.S. children who have disabilities may not have special needs for purposes of the adoption credit. Generally, "special needs adoptions" are the adoptions of children whom the state's child welfare agency considers difficult to place for adoption.
The credit is nonrefundable, which means it's limited to your tax liability for the year. However, any credit in excess of your tax liability may be carried forward for up to five years.
For more information please check Adoption Credit
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