§23 — Adoption expenses
1571 cases·186 followed·117 distinguished·10 questioned·25 criticized·15 limited·10 overruled·1208 cited—12% support
Statute Text — 26 U.S.C. §23
In the case of an individual, there shall be allowed as a credit against the tax imposed by this chapter the amount of the qualified adoption expenses paid or incurred by the taxpayer.
The credit under paragraph (1) with respect to any expense shall be allowed—
in the case of any expense paid or incurred before the taxable year in which such adoption becomes final, for the taxable year following the taxable year during which such expense is paid or incurred, and
in the case of an expense paid or incurred during or after the taxable year in which such adoption becomes final, for the taxable year in which such expense is paid or incurred.
In the case of an adoption of a child with special needs which becomes final during a taxable year, the taxpayer shall be treated as having paid during such year qualified adoption expenses with respect to such adoption in an amount equal to the excess (if any) of $10,000 over the aggregate qualified adoption expenses actually paid or incurred by the taxpayer with respect to such adoption during such taxable year and all prior taxable years.
So much of the credit allowed under paragraph (1) as does not exceed $5,000 shall be treated as a credit allowed under subpart C and not as a credit allowed under this subpart.
The aggregate amount of qualified adoption expenses which may be taken into account under subsection (a) for all taxable years with respect to the adoption of a child by the taxpayer shall not exceed $10,000.
The amount allowable as a credit under subsection (a) for any taxable year (determined without regard to subsection (c)) shall be reduced (but not below zero) by an amount which bears the same ratio to the amount so allowable (determined without regard to this paragraph but with regard to paragraph (1)) as—
the amount (if any) by which the taxpayer’s adjusted gross income exceeds $150,000, bears to
$40,000.
For purposes of subparagraph (A), adjusted gross income shall be determined without regard to sections 911, 931, and 933.
No credit shall be allowed under subsection (a) for any expense for which a deduction or credit is allowed under any other provision of this chapter.
No credit shall be allowed under subsection (a) for any expense to the extent that funds for such expense are received under any Federal, State, or local program.
If the portion of the credit allowable under subsection (a) which is allowed under this subpart for any taxable year exceeds the limitation imposed by section 26(a) for such taxable year reduced by the sum of the credits allowable under this subpart (other than this section and section 25D), such excess shall be carried to the succeeding taxable year and added to the portion of the credit allowable under subsection (a) which is allowed under this subpart for such taxable year.
No credit may be carried forward under this subsection to any taxable year following the fifth taxable year after the taxable year in which the credit arose. For purposes of the preceding sentence, credits shall be treated as used on a first-in first-out basis.
For purposes of this section—
The term “qualified adoption expenses” means reasonable and necessary adoption fees, court costs, attorney fees, and other expenses—
which are directly related to, and the principal purpose of which is for, the legal adoption of an eligible child by the taxpayer,
which are not incurred in violation of State or Federal law or in carrying out any surrogate parenting arrangement,
which are not expenses in connection with the adoption by an individual of a child who is the child of such individual’s spouse, and
which are not reimbursed under an employer program or otherwise.
The term “eligible child” means any individual who—
has not attained age 18, or
is physically or mentally incapable of caring for himself.
The term “child with special needs” means any child if—
a State or Indian tribal government has determined that the child cannot or should not be returned to the home of his parents,
such State or Indian tribal government has determined that there exists with respect to the child a specific factor or condition (such as his ethnic background, age, or membership in a minority or sibling group, or the presence of factors such as medical conditions or physical, mental, or emotional handicaps) because of which it is reasonable to conclude that such child cannot be placed with adoptive parents without providing adoption assistance, and
such child is a citizen or resident of the United States (as defined in section 217(h)(3)).
In the case of an adoption of a child who is not a citizen or resident of the United States (as defined in section 217(h)(3))—
subsection (a) shall not apply to any qualified adoption expense with respect to such adoption unless such adoption becomes final, and
any such expense which is paid or incurred before the taxable year in which such adoption becomes final shall be taken into account under this section as if such expense were paid or incurred during such year.
Rules similar to the rules of paragraphs (2), (3), and (4) of section 21(e) shall apply for purposes of this section.
No credit shall be allowed under this section with respect to any eligible child unless the taxpayer includes (if known) the name, age, and TIN of such child on the return of tax for the taxable year.
The Secretary may, in lieu of the information referred to in subparagraph (A), require other information meeting the purposes of subparagraph (A), including identification of an agent assisting with the adoption.
For purposes of this subtitle, if a credit is allowed under this section for any expenditure with respect to any property, the increase in the basis of such property which would (but for this subsection) result from such expenditure shall be reduced by the amount of the credit so allowed.
In the case of a taxable year beginning after
December 31, 2002
, each of the dollar amounts in paragraphs (3) and (4) of subsection (a) and paragraphs (1) and (2)(A)(i) of subsection (b) shall be increased by an amount equal to—
such dollar amount, multiplied by
the cost-of-living adjustment determined under section 1(f)(3) for the calendar year in which the taxable year begins, determined by substituting “calendar year 2001” for “calendar year 2016” in subparagraph (A)(ii) thereof.
If any amount as increased under paragraph (1) is not a multiple of $10, such amount shall be rounded to the nearest multiple of $10.
In the case of the dollar amount in subsection (a)(4), paragraph (1) shall be applied—
by substituting “2025” for “2002” in the matter preceding subparagraph (A), and
by substituting “calendar year 2024” for “calendar year 2001” in subparagraph (B) thereof.
The Secretary shall prescribe such regulations as may be appropriate to carry out this section and section 137, including regulations which treat unmarried individuals who pay or incur qualified adoption expenses with respect to the same child as 1 taxpayer for purposes of applying the dollar amounts in subsections (a)(3) and (b)(1) of this section and in section 137(b)(1).
1571 Citing Cases
Given the plain meaning of the relevant text and the historical setting laid out in detail in this Opinion, including caselaw, legislation, legislative history, and regulations, the Secretary’s adoption of a timely filing requirement and his attempted sub silentio overruling of contrary judicial and administrative precedents is unreasonable under Natl.
We therefore overrule our holding in Ewing I in light of this subsequent precedent and now construe section 6015(e) as not giving us jurisdiction over nondeficiency stand-alone petitions.10 But if we now think the disputed phrase is not ambiguous, its effect still seems to us anomalous.
The designation of section 165(d) as a subsection of section 165 (which, unlike section 23 of the 1934 Act and 1939 Code, contains only a few of the kinds of deductions the income- tax law allows) might suggest that section 165(d) does not limit deductions allowable under other sections of the Code (such as section 162) .
ion 43 on the schedule K-1 that it sent to Danny Holloway.2 The Holloways timely filed their 2002 joint tax return, and claimed not only the full $34,500 credit under section 29 or 43 from Mopass via Holloway, Inc., but also an adoption credit under section 23. The IRS first sent the Holloways a math error notice, claiming the Holloways miscalculated the amount of their section 29 or 43 credit.3 Unlike a notice of deficiency, a math error 1 All section references are to the Internal Revenue Code
Jones however involved section 23 of the Internal Revenue Code of 1939, the predecessor to section 165, which limited the deductibility of losses of individuals to - 9 - the same circumstances outlined in current section 165.
Section 23.55 of the Tex. Tax Code (West 1992) imposes an additional tax on 1-d-1 land if and when the use of that property changes. This additional tax is known colloquially as a "rollback tax". The rollback tax is an additional tax imposed by law as of the date the cessation or change of use occurs. It has its own delinquency date, and it does no
were deductible” under section 23 of the Revenue Act of 1932), rev’g 36 B.T.A.
6 As relevant here, section 23AA(5) of the Australian Income Tax Assessment Act 1936 provides: Where: (a) a foreign contractor or a foreign employee has derived income wholly and exclusively from, or from employment in connexion with, the performance in Australia of a prescribed contract; (b) the income is not exempt from income tax imposed by Chapter One of Subtitle
1076, 1077 (1948) (“Section 23 [now section 162] makes no provision for the cost of goods sold, but the Commissioner has always recognized, as indeed he must to stay within the Constitution, that the cost of goods sold must be deducted from gross receipts in order to arrive at gross income.
The statute expressly provides that the holder of a conservation easement owns the “interest of a holder in real property.” Ala.
1076, 1077 (1948) (“Section 23 [now section 162] makes no provision for the cost of goods sold, but the Commissioner has always recognized, as indeed he must to stay within the Constitution, that the cost of goods sold must be deducted from gross receipts in order to arrive at gross income.
A provision ofsection 23.13 ofthe deed states: "Unless the [p]arties expressly state that they intend a merger ofestates or interests to occur, no merger shall be deemed to have occurred hereunder or under any document executed in - 5 - [*5] the future affecting this grant." The deed provides that the interpretation and performance ofthe easement shall be gover
23B.06.400(6) (West 2013). The U.S. Bankruptcy Court for the Eastern District ofWashington held that this provision deprives a plaintiffofa cause ofaction under Washington's fraudulent- transfer laws when the transfer is a corporate distribution governed by that state's corporation law. See Metro. Mortg. & Sec. Co. v. Sandifur (In re Metro. Mo
23B.06.400(6) (West 2013). The U.S. Bankruptcy Court for the Eastern District ofWashington held that this provision deprives a plaintiffofa cause ofaction under Washington's fraudulent- transfer laws when the transfer is a corporate distribution governed by that state's corporation law. See Metro. Mortg. & Sec. Co. v. Sandifur (In re Metro. Mo
Section 23(1) ofthe Act provides that the financial provision can take the form ofperiodical payments, secured periodical payments, or a lump-sum payment to the other spouse.
23B.06.400(6) (West 2013). The U.S. Bankruptcy Court for the Eastern District ofWashington held that this provision deprives a plaintiffofa cause ofaction under Washington's fraudulent- transfer laws when the transfer is a corporate distribution governed by that state's corporation law. See Metro. Mortg. & Sec. Co. v. Sandifur (In re Metro. Mo
570, 573 (1978)); see also Am.
We therefore conclude on the preponderance ofthe evidence that the section 23The preceding taxable year must have been a taxable year of 12 months, and the taxpayermust have been a U.S.
ions.1° In doing so, we necessarily reduced the amount shown as tax by the 9See sec. 21 (expenses for household and dependent care services necessary for gainful employment); sec. 22 (credit for the elderly and the permanently and totally disabled); sec. 23 (adoption expenses); sec. 24 (child tax credit); sec. 25 (interest on certain home mortgages); sec. 25A (hope and lifetime learning credits); sec. 25B (elective deferrals and IRA contributions by certain individuals); sec. 25C (nonbusiness en
e from the definition of an underpayment to the definition of a deficiency. See sec. 21 (expenses for household and dependent care services necessary for gainful employment); sec. 22 (credit for the elderly and the permanently and totally disabled); sec. 23 (adoption expenses); sec. 24 (child tax credit); sec. 25 (interest on certain home mortgages); sec. 25A (hope and lifetime learning credits); sec. 25B (elective deferrals and IRA contributions by certain individuals); sec. 25C (nonbusiness en
23-1-17 (LexisNexis 1982); see also Dejoo v. Suntrust Mortgage, Inc., 668 S.E.2d 245 (Ga. 2008); Lesser v. 5Black's Law Dictionary 1189 (8th Ed. 2004) defines a plat as a "map describing a piece ofland and its features, such as boundaries, lots, roads, and easements." G0 - Doughtie, 686 S.E.2d 416 (Ga. Ct. App. 2009). Purchasers who have noti
provides that if an LLC-wishe.s to do business under a name other .than the name on its .articles of organization, the LLC must file a certificate stating the assumed name with the Indiana secretary of state .
duced, and any overpayment of tax may be credited upon the tax imposed by this chapter, or at'the election of the licensee, the licensee not being delinquent in the payment of any taxes owing to the State, may be refunded inlithe manner provided in section 23.1-23(d), provided thatl~mo reduction of tax may be made when forbidden by subsection (b), or more than five years after the II riling or the return.
Ross does not qualify for section 23In addition, the requesting spouse's proportionate share of the deficiency shall be increased by the value of any disqualified asset transferred to her by the nonrequesting spouse .
23-2-21 (1982) provides as follows: What mistakes relievable in equity; power to relieve to be exercised cautiously. (a) A mistake relievable in equity is some unintentional act, omission, or error arising from ignorance, surprise, imposition, or misplaced confidence. (b) Mistakes may be either of law or of fact. (c) The power to relieve mista
1961-256), stated: From the very import of Section 23 [referring to sec.
oner was required to contribute a percentage of his salary to the ERS through automatic payroll deductions. Petitioner’s contributions were made on an after-tax basis prior to October 1, 1989, and on a pre-tax basis thereafter. Baltimore County Code sec. 23-91(g) (1988). Pursuant to Baltimore County Code section 23-91(g) (1988), the pre-tax employee contributions petitioner made after October 1, 1989, were “pick up” contributions made by Baltimore County in accordance with section 414(h)(2). As
Any purported Transfer in violation of Section 23 shall be null and void and shall not be recognized by the Company.
212, 218 (1941), the Supreme Court held that the salaries and expenses incident to looking after a taxpayer’s own investments were not deductible under section 23 (the predecessor of section 162(a)).
Any purported Transfer in violation of Section 23 shall be null and void and shall not be recognized by the Company.
23B.06.270 (West 2001), or, if the shareholder dissents from a corporate action, the dissenting shareholder may obtain payment of the fair value of his or her shares, Wash. Rev. Code Ann. sec. 23B.13.020 (West 2001). Furthermore, the corporation may divest 12 We note that no such corporate documents were introduced into evidence. - 10 - a sha
l damages” and encompass all types of damages other than punitive damages. Fountain-Lowrey Entrs, Inc. v. Williams, 424 So. 2d 581, 585 (Ala. 1982); Skipper v. S. Cent. Bell Tel. Co., 334 So. 2d 863, - 10 - 866 (Ala. 1976); 22 Am. Jur. 2d, Damages, sec. 23 (1988); 25 C.J.S., Damages, sec. 2 (1966). A plaintiff may be awarded compensatory damages for claims of breach of contract, conversion, conspiracy, or fraudulent inducement. See, e.g., Estate of Henderson v. Henderson, 804 So. 2d 191, 192 (Al
l damages” and encompass all types of damages other than punitive damages. Fountain-Lowrey Entrs, Inc. v. Williams, 424 So. 2d 581, 585 (Ala. 1982); Skipper v. S. Cent. Bell Tel. Co., 334 So. 2d 863, - 10 - 866 (Ala. 1976); 22 Am. Jur. 2d, Damages, sec. 23 (1988); 25 C.J.S., Damages, sec. 2 (1966). A plaintiff may be awarded compensatory damages for claims of breach of contract, conversion, conspiracy, or fraudulent inducement. See, e.g., Estate of Henderson v. Henderson, 804 So. 2d 191, 192 (Al
1939, states: The proposed section 22(n) of the Code provides that the term "adjusted gross income" shall mean the gross income computed under section 22 less the sum of the following deductions: (1) Deductions allowed by section 23 of the Code, which are attributable to a trade or business carried on by the taxpayer not consisting of services performed as an employee; * * * (4) deductions allowed by section 23 which are attributable to rents and royalties; * * * * * * * * * * The deductions des
nstruction, * * * material omitted on reenactment is deemed repealed.”), revd. on other grounds sub nom. United States Natl. Bank v. Independent Ins. Agents of Am., Inc., 508 U.S. 439 (1993). See generally Singer, Sutherland Statutory Construction, sec. 23.28, at 413 (5th ed. 1993). As we observed in Schwalbach v. Commissioner, 111 T.C. 215, 228 (1998): “Although the * * * [1992 proposed regulations were] silent on this rule, including whether the Commissioner was considering abandoning it, we r
section 23 of the Code, which are attributable to a trade or business carried on by the taxpayer not consisting of services performed as an employee; * * * (4) deductions allowed by section 23 which are attributable to rents and royalties; * * * The deductions described in clause (1) above are limited to those which fall within the category of expe
23-1-30-9(b) (Michie 1999), the Indiana corporate law applicable to financial institutions does not appear to permit cumulative voting. See Ind. Code Ann. sec. 28-13-6-9 (Michie 1996). - 7 - b. Stock Transactions There was no regular market for Peoples common stock, and transfers were infrequent. On the valuation date, Peoples did not have an
lic safety, wrote a letter "to whom it may concern" in which he stated: In accordance with the Collective Bargaining Agreement between the City of Pawtucket and Local 1261, International Association of Fire Fighters, Article XV, Section 3 and Section 6 and also the Charter of the City of Pawtucket, specifically, the revised ordinances, Chapter 23, Section 23-2.2 Paragraph B.
23.17(a)(2) of Regs. 104 under the Code of 1939 (1939 Code); sec. 33.17(a)(2) of Regs. 110 under the Second Revenue Act of 1940, ch. 757, 54 Stat. 974, relating to the excess profits tax; and sec. 24.17(a)(2) of Regs. 129 under the 1939 Code in respect of years after 1949 and before 1954. 37 After the enactment of the 1954 Code, regulations su
Specifically, Section 16 lost $2,600; Section 18 lost $3,500; Section 20 lost $65,973.87; Section 21 lost $22,000 and Section 23 lost $37,816.60.
23-2-25, 23-2-30 (1982); Curry v. Curry, 473 S.E.2d 760, 761 (Ga. 1996); Fox v. Washburn, 449 S.E.2d 513, 514 (Ga. 1994); Sheldon v. Hargrose, 100 S.E.2d 898, 900 (Ga. 1957); McCollum v. Loveless, 200 S.E. 115, 117 (Ga. 1938). Reformation as applied to a contract is a remedy cognizable in equity for the purpose of correcting an instrument so a
23.628(31) (Law. Co-op. 1991). Because of this law, insurance agencies were created to collect the commissions paid by the insurance companies. Such agencies, although closely related to the dealerships, were legally separate from them under Michigan law. - 8 - Realistically, however, the sale of credit insurance is part of the dealership's f
22(n)(1) of the 1939 Code provides that AGI equals gross income less "deductions allowed by section 23 which are attributable to a trade or business carried on by the taxpayer, if such trade or business does not consist of the performance of services by the taxpayer as an employee".
Instead, the effect of section 23, the predecessor to section 212, was to provide for a class of nonbusiness deductions that were incurred in the production of income or in the management or conservation of property held for the production of income.
22(n)(l) of the 1939 Code provides that'AGI equals gross income less “deductions allowed by section 23 which are attributable to a trade or business carried on by the taxpayer, if such trade or business does not consist of the performance of services by the taxpayer as an employee”.
If this Agreement terminates by expiration of the term set forth in Article 5 or pursuant to the provisions of Section 23, ABS and participating financial institutions may retain such records as are necessary in order for them to maintain any customer relationships established hereunder with any SC member.