Fearless Money

This year, like last year, I honestly look forward to filing my income taxes. In December 2004, we completed adopting a child from China. Many people don’t know this, but the federal government as well as most state governments offer a very generous tax credit for adopting families.

Basically, it worked out to approximately $12,000, state and federal combined. That is a tax credit, not just a wimpy old write-off. Every dollar of that $12,000 was a dollar we didn’t have to pay in income taxes. Even better, it rolls forward (for up to six years) until it is all used up. For my family, that meant we did not pay a dime in federal or state taxes last year.

This year we’ll pay a little, but still get to take back several thousand remaining in the roll-over.
TurboTax handled it all, which surprised and pleased me. In fact, I’ve already ordered my copy of the software this year, since all the roll-over calcs are already done for me based on last year’s remainders. If it weren’t for that, I’d definitely be using TaxBrain, which is an inexpensive online tax service I’ve been hearing great things about.

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