How to pay for adoption costs

Adoption is a life-changing experience for children and parents. However, if you're wondering how to pay for an adoption, you're not alone. According to the Profiles in Adoption Survey (PDF) from the National Council For Adoption, or NCFA, more than half of pre-adoptive parents surveyed were concerned that adoption costs would be a barrier.

The good news is that many parents ultimately find ways to make adoption costs more manageable. Learn about multiple resources—from adoption grants and subsidies to tax credits and loans—that may help fund the cost of adoption.

Understanding the cost of adoption

Adoption costs vary based on the type and source of adoption. Generally, there are two paths to follow, each with its own cost structure.

Foster care adoption

Because foster care adoptions are state funded, they're typically the most affordable option for many families. According to the NCFA survey, roughly 81% of parents who adopt from foster care receive assistance to cover the upfront adoption costs. In addition, nearly 93% receive a monthly subsidy to help pay for ongoing child care.

Private adoption

If you pursue a private adoption, you can expect significantly higher costs. The NCFA survey found that upfront expenses average $33,142 for a domestic adoption and $36,776 for an international adoption.

The cost of private adoption typically includes several aspects.

• Agency fees: You can expect to pay anywhere from $15,000 to $30,000 for an agency's role in matching you with a child and facilitating the adoption.
• Legal fees: You'll need to pay for a variety of legal expenses, including court filing and attorney fees. If you're considering international adoption, you'll need to pay immigration fees as well.
• Home-study fees: As part of the adoption process, a licensed agency or social worker will assess your home's safety and suitability for raising a child. Home-study fees may also include the cost of a criminal background check and medical check for all household members.
• Birth mother expenses: State laws vary, but many states require adoptive parents to pay for the birth mother's medical care, living expenses, and counseling and legal fees.
• Travel expenses: If you're pursuing an international or interstate adoption, factor in the cost of adoption-related travel expenses. These typically include airfare, ground transportation, meals and lodging.

Because adoption costs can vary substantially, it's a good idea to speak with several agencies and compare prices before making a commitment.

How to fund an adoption

While the cost of adoption can be quite steep, there are several strategies to help manage and reduce expenses. Here are some options to explore.

Adoption grants

For those struggling with how to afford adoption costs, adoption grants can be a helpful resource. Many nonprofit organizations and foundations offer grants for adoptive parents. Some are state-specific or income-based, while others are broader. For example, the National Adoption Foundation issues quarterly grants, the quantity and amount of which depend on available funds.

Government assistance programs

Federal initiatives like Title IV-E and numerous state programs are designed to help reduce the cost of adoption. While requirements vary by program, they generally apply to children with eligible needs adopted from foster care.

Adoption tax credit

While the Adoption Credit won't cover the upfront cost of adoption, it can reduce your tax liability when you file your return. Plus, this credit can be claimed in conjunction with other tax credits and deductions for parents.

For 2025, the Adoption Credit covers up to $17,280 in qualified adoption expenses—such as court and attorney fees, adoption fees and travel costs—depending on your income. If the credit exceeds your tax liability, you can carry the unclaimed amount forward for up to 5 years. You can review IRS guidelines to determine your eligibility and see what expenses qualify.

Employer benefits

Many employers have started to offer benefits designed to make adoption costs more manageable, such as financial assistance and paid adoption leave. Check with your human resources department to see what benefits may be available.

Crowdfunding

Your loved ones may be eager to chip in to help you make your adoption dream a reality. If you'd like to cast a wider net, there are a variety of crowdfunding sites to choose from, including a few tailored to adoptive parents.

Adoption loans

If you must take on debt to fund an adoption, it's important to carefully evaluate your options. If you have good credit, a personal loan may be a better choice than using a credit card. If you have some equity built up in your home, a home equity loan or line of credit is another option to consider. These loans typically have lower interest rates than personal loans, and the money can be used for any purpose.

Retirement savings

The IRS allows you to withdraw up to $5,000 per child from your retirement savings to help pay for qualified adoption expenses without incurring an early withdrawal penalty. Another option is to borrow money from your workplace retirement savings if your plan allows. However, check with your plan administrator to learn more about borrowing limits, repayment timelines, penalties for nonpayment and other rules.

It's always a good idea to talk to a financial advisor about the long-term impact of taking on debt or tapping into your retirement savings.

The bottom line

Given the costs, determining how to afford adoption may seem intimidating. However, a smart financial plan can help you better manage the various adoption costs. By exploring different funding options and resources, you can make your adoption dreams a reality.

This strategic approach can also help you prepare for other parenting costs. From child care and insurance to education and estate planning, it helps to have a financial plan for having a child.