A separate benefit from the adoption tax credit — employer-provided adoption assistance is excluded from taxable income up to the same dollar cap and phase-out range.
How it works
Employer-provided assistance is capped at the maximum exclusion amount. Below the phase-out floor, the full amount is excluded; within the range, it phases down proportionally; above the ceiling, no exclusion applies.
What this does not include
An employee cannot use the same adoption expenses for both this exclusion and the adoption tax credit — this site’s separate adoption-tax-credit calculator covers the credit for out-of-pocket expenses beyond any employer-provided assistance.
How to use this calculator
- Enter employer-provided adoption assistance and MAGI.
Frequently asked questions
Can I claim both the adoption credit and this exclusion?
Yes, but not for the same expenses — the credit applies to qualified expenses paid out of pocket, while the exclusion applies specifically to amounts an employer’s adoption assistance program pays or reimburses.
Do all employers offer adoption assistance programs?
No — it’s an optional employee benefit some employers choose to offer, generally structured as a written plan meeting IRS requirements.
Is the excluded amount reported anywhere?
Yes — it’s typically reported in Box 12 of Form W-2 with code T, and the exclusion (and any phase-out) is reconciled on Form 8839.
