The Internal Revenue Service has begun issuing automatic refunds to certain taxpayers with adoption tax credit carryforwards.
In an October 16 announcement, the agency said the process covers more than 50,000 taxpayers, with most eligible adjustments expected to be completed by year-end.
Who may qualify?
For tax year 2025 only, unused adoption credit carryforwards from 2020 through 2024 may increase the refundable credit, subject to a $5,000 limit per eligible child.
That limit is not a guaranteed additional payment. The adjustment depends on the taxpayer’s qualifying credit and return.
Is an amended return required?
The IRS says affected taxpayers generally do not need to take action or amend their returns to receive this adjustment.
Returns filed before April 15, 2026, will generally receive applicable adjustments automatically. The IRS may review extension filers and accounts with identity-theft indicators, freezes, dependency conflicts, or other unresolved issues later.
An adjustment may produce a refund or be applied to outstanding tax or non-tax debt.
Watch for an IRS notice
The agency says taxpayers will generally receive a notice within 30 days of the adjustment.
Recipients should compare it with their 2025 return and retain it with their records. The year-end processing expectation does not establish an individual payment date.
Separate from a new adoption-credit claim
This adjustment concerns previously unused credits. The adoption credit itself has eligibility, expense, income, and timing requirements.
Qualifying expenses can include adoption fees, attorney fees, court costs, and certain travel expenses. You cannot use expenses reimbursed by an employer for the credit.
Families preparing a new claim can review the IRS adoption credit page and Form 8839 instructions.
Source: IRS announcement on automatic adoption credit refunds.