[Congressional Record Volume 141, Number 109 (Friday, June 30, 1995)]
[Extensions of Remarks]
[Page E1383]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]


          INTRODUCTION OF THE ADOPTION INCENTIVES ACT OF 1995

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                       HON. JOSEPH P. KENNEDY II

                            of massachusetts

                    in the house of representatives

                         Friday, June 30, 1995
  Mr. KENNEDY of Massachusetts. Mr. Speaker, today I am introducing the 
Adoption Incentives Act of 1995 in an effort to encourage more 
adoptions in our country.
  This bill will provide a range of tax incentives to adoptive parents 
to help them build families through adoption. Specifically, the bill 
will make adoption assistance benefits to military and private sector 
employees for nonrecurring adoption expenses tax-free, and allow 
penalty-free and tax-free withdrawals from individual retirement 
accounts [IRA's] for adoption expenses.
  There is a desperate need for adoption in our country. Today, almost 
half a million children are in foster care. Some of these kids languish 
in the foster care system for more than 5 years, bouncing from one home 
to another. Between 85,000 and 100,000 of these children are legally 
free and waiting to be adopted. An additional 3 million children were 
reported abused or neglected in 1993. Many may need a safe haven--a 
welcoming home that adoption could provide.
  One major obstacle to finding permanent, loving homes for these 
children is the cost of adoption. The average cost of a private or 
nonagency adoption is conservatively estimated at $10,000 and can run 
as high as $45,000. Many adoptive families have to mortgage their homes 
or borrow money from relatives to build a family.
  In response, 180 of the Fortune 1,000 companies have established 
corporate programs that provide financial assistance to employees to 
help cover adoption expenses. Behind borrowing money and mortgaging 
homes, reimbursement benefits provided by employers are the third major 
way in which parents finance adoptions.These benefits average $2,000 
per adoption. In 1993, corporate adoption assistance programs 
facilitated 2,000 of the 50,000 adoptions that occurred.
  The private sector has been especially creative in providing 
incentives for adoption. We must do more to encourage their efforts--as 
this bill does.
  A similar adoption assistance program was established for military 
personnel in the defense authorization bill of 1991. Military families 
are entitled to up to $2,000 to cover adoption-related expenses. 
Launching this program sent a positive signal to adoption agencies that 
were often reluctant to start the adoption process due to frequent 
relocations of many military families. As a result, almost 2,500 
children have been adopted with this assistance.
  The Adoption Incentives Act would also permit penalty-free and tax-
free withdrawals from IRA's for adoption costs. Many of the tax 
proposals now pending before Congress would allow penalty-free IRA 
withdrawals for college tuition, buying a first home, or caring for an 
elderly parent, as well as catastrophic medical expenses. Shouldn't 
adoption be encouraged in this same way? The answer is clear--adoption 
is also an investment in the future.
  Mr. Speaker, it is time that we send the message that adoption is a 
valued way of building a family and a future for our children. It is a 
goal we should all support.


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