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The IRS has issued the 2005 monthly limits for the adoption assistance
exclusion and tax credit.
For 2005, the maximum exclusion under Code Section 137 for qualified
adoption expenses and adoption of a child with special needs will
be $10,630, an increase of $240 from the 2004 limit of $10,390.
The maximum credit under Section 23 for qualified adoption expenses
and adoption of a child with special needs also will be $10,630.
The amount that can be excluded from an employee's gross income
begins to phase out for taxpayers with modified adjusted gross income
(AGI) of more than $159,450 and is completely phased out with modified
AGI of $199,450.
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