In 2021 - and it was allowed, the Adoption credit offset Income Tax and the refundable child tax credit was issued. in 2022, prepare the return with the adoption credit carryover, apply it against income tax and request refundable child tax credit. Taxpayer received notice and refund was reduced. per t/c with IRS the adoption credit cannot be applied first to reduce income tax and a refundable child tax credit be issued. I am researching on my own - but wanted to reach out in case someone else has experienced this issue as the agent stated i was the second call in regards to this matter today.
Clients adopted special needs children in 2021 - qualifying for max credit carryover and have 4 children. New one in 2022 - as this happens after adoption. 🙂 Thank you in advance for any assistance.
