Adoption Credit issue: cannot proceed entering prior year expenses without child details (*we are not yet matched*, domestic adoption)

[martinb182]

Turbo Tax does not allow people who have not been matched with a child yet to enter adoption expenses (e.g. home study) from the start of the adoption process in the year prior.

When reporting qualified domestic adoption expenses for a child not yet identified/matched, TurboTax online and desktop currently requires entry of a child’s birth year (UI restricts this to the current tax year or earlier) and other child-specific details (special needs status) to proceed. This creates a perceived roadblock for users who are correctly claiming pre-finalization expenses but do not yet have a matched child. 

IRS rules allow taxpayers to claim these expenses without having a child's SSN or identified child (i.e., “child not yet identified” on Form 8839). The current UI forces users to input placeholder (and thus potentially inaccurate) information, which is confusing and raises concerns about audit risk and incorrect credit calculations. At a minimum, TurboTax should provide clear on-screen guidance for how to proceed.  

When I called TT, an agent said to enter placeholder information (e.g. use the current tax year as the birth year, "no" to special needs, et.c) just to force the population of the correct forms, then correct it in a later tax year after the adoption is finalized.

If this is, in fact, the way to do it, there has got to be better on-screen prompting to walk users through this complicated situation and give peace of mind about what otherwise sounds like an audit risk in the future.

[JotikaT2]

According to the IRS, you can only deduct expenses for adoption expenses in the year after you pay or incur them if the adoption is still in progress.  This applies to domestic adoptions.  If you have a foreign adoption, the expenses can only be claimed for the adoption credit once the adoption is final.

If you incurred or paid your initial adoption costs in 2025, then you would claim these on your 2026 tax return.  

Please also see What is IRS Form 8839: Qualified Adoption Expenses for more details on qualifying expenses.