H.R.1427 - To amend the Internal Revenue Code of 1986 to increase the amount of the adoption credit and to establish the in vitro fertilization expenses credit. (119th Congress)
Summary
H.R. 1427 proposes amendments to the Internal Revenue Code of 1986, specifically targeting the adoption credit and introducing a new credit for in vitro fertilization (IVF) expenses. The bill aims to increase the adoption credit amount and establish a tax credit for qualified IVF expenses. It was introduced in the House of Representatives on February 18, 2025, by Mr. Mackenzie and referred to the Committee on Ways and Means.
The bill increases the adoption credit to $25,000 and adjusts the base year for inflation adjustments related to the credit. It also introduces Section 25F to the Internal Revenue Code, which allows a credit for qualified in vitro fertilization expenses.
The amendments related to the adoption credit apply to taxable years beginning after December 31, 2024, while the IVF expense credit applies to amounts paid or incurred after the date of the bill's enactment.
Expected Effects
If enacted, H.R. 1427 would increase the financial assistance available to families adopting children, particularly those with special needs. It would also provide financial relief to individuals and couples undergoing in vitro fertilization treatments.
The increased adoption credit could incentivize more adoptions, especially of children with special needs. The IVF expense credit could make fertility treatments more accessible to a broader range of individuals and couples.
The changes to the Internal Revenue Code would require adjustments to tax forms and processes. The overall impact on the federal budget would depend on the number of adoptions and IVF treatments claimed under the new credit provisions.
Potential Benefits
- Increased Financial Assistance for Adoption: The increase in the adoption credit to $25,000 provides substantial financial relief to adoptive families.
- Support for Special Needs Adoptions: The specific increase in credit for adopting children with special needs encourages and supports these adoptions.
- Financial Relief for IVF Treatments: The establishment of a tax credit for IVF expenses makes fertility treatments more affordable and accessible.
- Promotes Family Formation: By reducing the financial burden of adoption and IVF, the bill supports individuals and couples in forming families.
- Inflation Adjustment: The adjustments for inflation ensure that the credit amounts maintain their value over time.
Potential Disadvantages
- Potential for Increased Deficit: The new and expanded tax credits could increase the federal budget deficit.
- Complexity in Tax Code: Adding a new tax credit for IVF expenses adds complexity to the tax code, potentially requiring additional guidance and resources for taxpayers.
- Limited Scope of IVF Credit: The IVF credit only applies to medical expenses related to IVF, potentially excluding other fertility treatments.
- Income Limitations: While not explicitly stated, tax credits often have income limitations, which could exclude some individuals and families from benefiting.
- Uncertainty in Enactment Date: The effective date for the IVF credit depends on the date of enactment, creating uncertainty for those planning or undergoing IVF treatments.
Most Disadvantaged Areas:
Constitutional Alignment
The bill aligns with the Constitution's broad goals of promoting the general welfare (Preamble). The power to tax and spend for the general welfare is granted to Congress under Article I, Section 8, Clause 1. The bill does not appear to infringe upon any specific constitutional rights or limitations.
The bill does not appear to violate any specific amendments. It does not establish a religion (Amendment I), infringe on the right to bear arms (Amendment II), or violate due process or equal protection (Amendment V, XIV).
However, the expansion of tax credits could be subject to debate regarding the scope of the "general welfare" clause and the appropriate role of the federal government in incentivizing certain family planning decisions.
Impact Assessment: Things You Care About ⓘ
This action has been evaluated across 19 key areas that matter to you. Scores range from 1 (highly disadvantageous) to 5 (highly beneficial).