Adoption Workplace Assistance Credit Received in 2025 for a 2024 Adoption, check this entry error for adoption

[user17727169060]

We adopted a child in 2024 and our expenses were more than the credit so we received the full amount.  My spouse received adoption assistance from their job in early 2025 for the adoption, but the total of the assistance and the full credit are lower than the total expenses we had and I entered in the 2024 tax return.  For the 2025 return, when doing the final smart check, I get this error to check for 'Adoptive Child Worksheet (Untitled): Employer assistance - No should be answered.'  I remove the check and when continuing and running the smartcheck again, I get the same error.  We didn't adopt a child in 2025, just in 2024, but I assume this is because of the box 12 code T assistance from their job.  Not sure what to do with this error.

[MonikaK1]

You said your expenses were more than the credit, so you received the full amount of the credit for 2024. Please clarify. Did you have remaining expenses to carry over additional credit to 2025? or additional expenses paid in 2025? 

You do need to account for the employer benefits received. The income exclusion is in addition to the credit, but you can’t claim both for the same expenses. You must claim any allowable exclusion before claiming any allowable credit. To do this, complete Part III of Form 8839 before you complete Part II.

If you claim expenses in more than one year for the same adoption (final or in progress), you must subtract past credit amounts you claimed from your remaining credit. See this IRS webpage for more information.

Example: You claimed a $3,000 Adoption Credit in 2024 for expenses incurred in 2023 for the adoption of a child that was not finalized during that year.  In 2025, you paid $17,280 for additional expenses related to the adoption of the same child, which was finalized during the year.  Since you are claiming expenses related to the adoption of the same child and have already claimed a $3,000 Adoption Credit in past years, you can only claim a credit of $14,280 in 2025 ($17,280 less the $3,000 credit you previously claimed).

Example: In 2025, you paid $10,000 in qualified adoption expenses, and your employer reimbursed you for $4,000. You can exclude $4,000 from your income. Your maximum credit is $6,000 ($10,000 less the $4,000 employer reimbursement).

Please see this TurboTax help article and also IRS Tax Topics 607 for more information.

 
If you still can't clear the error, you can send us a “diagnostic” file that has your “numbers” but not your personal information.  If you would like to do this, here are the instructions for TurboTax Online users: 

Go to the black panel on the left side of your program and select Tax Tools. 

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5. Post the full token number here in this thread

We will then be able to see exactly what you are seeing and we can determine what exactly is going on in your return and provide you with a resolution.

[user17727169060]

Hello, yes I used the full amount of the credit in 2024 because our expenses were more than $30K, which we accounted for in the 2024 Turbotax tax return, so we got the full credit at $16,810.  We had no adoption expenses in 2025, all in 2024.  It is just that my spouse's employer provided $10K in adoption assistance in 2025.  

For this part:

"You do need to account for the employer benefits received. The income exclusion is in addition to the credit, but you can’t claim both for the same expenses. You must claim any allowable exclusion before claiming any allowable credit. To do this, complete Part III of Form 8839 before you complete Part II."

Is there anything additional I should add to the tax return then since the expenses are more than the total of the credit taken and the employer assistance?  

Form 8839 Part 3 mentions the maximum exclusion for 2025 but everything was paid for and finalized in 2024.  For question#20 - Did you receive employer-provided adoption benefits for a prior year for the same child?  The answer is no, we received the employer provided benefits the next year, not the prior year.

For Form 8839 part 3 #22, Employer-provided adoption benefits you received in 2025. This amount should be shown in box 12 of your 2025 Form(s) W-2 with code T.  That one I can enter the $10K.  

Also our AGI was less than $200K so we wouldn't be limited with the AGI for the benefit.

Thank you!

[AmyC]

No. Let's start with the math. Your expenses were over $30k. Subtract $16,810 claimed in 2024. The remainder is more than $10k. You are eligible to claim the credit with the employer assistance.

Form 8839, part III for employer benefits. 

Prior year - no

Here is what yours should look like. 

[user17727169060]

Hi Amy,

Thank you for your help!  I entered information about my adopted child through the easy step process but I checked the forms and I realized that the form 8839 only shows the 'Qualified Adoptive Child Worksheet' but not the 'Form 8839' with parts 1, 2, 3 for the 2025 tax return.  The 2024 tax return shows the Form 8839 with parts 1, 2, 3, but not sure how to generate the form 8839 with those parts, or maybe they aren't needed because of what I entered:

Thank you!

[LindaS5247]

If your Form 8839 is not generating, you can try a few things:

• Make sure the date the adoption was finalized is entered in TurboTax.
• Make sure the child's name and Social Security number are correct in TurboTax.
• Clear your cache and cookies. This often helps with data issues. ‌Please click here for instructions on how to clear your cache. Please click here for instructions on clearing your cookies.
• You can delete and re-enter your adoptive child's information in TurboTax to see it it will trigger the form.

Keep in mind:

• It is a non-refundable credit, so it may be limited in the current year if your tax on line 24 of your form 1040 is reduced to zero. Nonrefundable tax credits reduce your federal income tax liability dollar-for-dollar but cannot reduce your tax bill below zero or generate a refund.
• The credit is per child, not per year. The maximum credit for 2025 is $17,280. The total credit claimed over all years cannot exceed the maximum allowed amount ($17,280 for 2025) per child. 
• Eligibility depends on your 2025 Modified Adjusted Gross Income which begins to phase out at $259,190.
   

If this does not help please come back and let us know.  You can provide a token number for us to view a sanitized copy of your TurboTax data to see where the issue may be. You can follow MonikatK1's instructions listed above to get a token number to share with us.

As per MonikatK1 mentions above:

If you still can't clear the error, you can send us a “diagnostic” file that has your “numbers” but not your personal information.  If you would like to do this, here are the instructions for TurboTax Online users: 

Go to the black panel on the left side of your program and select Tax Tools. 

1. Then select Tools below Tax Tools.
2. A window will pop up which says Tools Center.
3. On this screen, select Share my file with Agent.
4. You will see a message explaining what the diagnostic copy is.  Click okay through this screen and then you will get a Token number.
5. Reply to this thread with your Token number. This will allow us to open a copy of your return without seeing any personal information.

Here are the instructions for TurboTax Desktop users:

1. From the black bar at the top of your screen, select Online
2. Click Send Tax File to Agent
3. Click Send on the message that pops up
4. TurboTax will create a "sanitized" copy of your return information with no personal info
5. Post the full token number here in this thread

We will then be able to see exactly what you are seeing and we can determine what exactly is going on in your return and provide you with a resolution.