Do grandparents get money for adopting grandchildren?
Adopting a grandchild can be a big decision for grandparents. While being able to provide your grandkids with a stable home is a wonderful gift, taking on the legal and financial responsibilities of parenthood again requires serious consideration.
One question that often comes up when grandparents are weighing whether to formally adopt their grandkids is do grandparents get money for adopting grandchildren?
The answer isn’t straightforward. Financial assistance may be available, but the specific amounts and types of help can vary based on your state, your grandchild’s special needs, your income level, and other factors. With some digging and planning, however, you may be able to access resources to help cover the costs of raising your adopted grandkids.
Financial help for adoptive grandparents
Here are some of the main ways grandparents can get financial assistance when adopting their grandchildren:
Foster care payments
If you become a licensed foster parent to your grandchild first before adopting, you may be able to receive foster care payments. These payments are generally intended to help cover the child’s living expenses.
According to the most recent data from the U.S. Department of Health and Human Services, the average monthly foster care payment was $54<9 per child as of 2020. Payments ranged from $300 up to $1000+ per month, depending on each state’s rates.
So in the foster-to-adopt process, this can provide some income while you have temporary custody of your grandchild. The payments usually continue at the same rate after adoption is finalized.
Many states provide adoption assistance for children adopted out of foster care. This is different than foster payments and is meant to be ongoing help for adoptive parents.
To qualify, there are typically some requirements:
- The child must have special needs. This is defined as a specific factor or condition (such as ethnic background, age, sibling group status, medical condition, or physical/mental/emotional disability) that would make it harder for them to be adopted.
- The child must have been eligible for federal foster care payments before the adoption.
- You must be adopting through the public foster care system, not through a private agency.
If eligible, adoption assistance can include a monthly payment ranging from around $300 up to $2000 or more, Medicaid coverage for the child, and sometimes reimbursement for one-time adoption expenses.
The amount of the monthly payment is determined at the state level based on factors like the child’s needs and what foster care payments they were receiving. On average, SSI payments for adopted children are $700 per month.
Adoption assistance usually continues until the child turns 18 or 21, depending on your state’s rules. The median length of time adoption assistance payments last is 8 years.
The main tax benefit for adoptive grandparents is the federal adoption tax credit, worth up to $14,300 per child in 2020. There are a few qualifiers:
- The child must be under age 18 or disabled.
- You must be adopting, not just becoming a legal guardian.
- The credit is phased out at higher income levels (over $211,160 for single filers or $326,200 for joint returns in 2020).
Additionally, some states offer a state adoption tax credit or income tax deduction, typically ranging from $1,000 to $13,000.
One tax disadvantage, though, is that grandparents adopting grandchildren don’t qualify for the Child Tax Credit or Earned Income Credit since there isn’t a legal parent-child relationship. But the adoption credit may help offset this.
If adoption isn’t possible or preferable, becoming a legal guardian to your grandchild is another option. Some states have subsidized guardianship programs that provide ongoing assistance that’s similar to adoption subsidies.
For example, Tennessee’s Relative Caregiver Program provides a monthly payment to help cover costs, which ranges based on factors like the child’s age. The average payment is $790 per month according to one review.
TANF & other public assistance
Other sources of financial help may include:
- Temporary Assistance for Needy Families (TANF): Provides monthly cash assistance for very low-income families with children. Average monthly payments are around $450 per family.
- Supplemental Security Income (SSI): For children with disabilities who meet income and resource limits, SSI provides an average of $698 per month. Adoptive grandparents can apply on the child’s behalf.
- Social Security: If the grandchild’s parents are deceased or disabled, the child may be eligible for Social Security benefits. The average payout for a disabled worker with one child is around $1500 monthly.
- State benefits: Programs like food stamps, Medicaid, child care subsidies and more may be available. Benefits vary based on location and eligibility.
Adoption subsidies by state
Adoption assistance programs and subsidy payment amounts can vary significantly by state. Here is an overview of some state-by-state differences:
- Alaska: Foster adoption assistance ranges from $576-$3,250 monthly. Factors considered include the child’s needs and what foster care rate they received.
- California: Adoption assistance payments range from $489-$1,659 per month. There are different rates based on age.
- Colorado: Monthly adoption assistance ranges from $300-$1,000 depending on the child’s needs.
- Florida: Monthly payments are $531 for ages 0-5, $576 for ages 6-12, and $642 for teens. Higher amounts are possible for children with special needs.
- Illinois: Children ages 0-5 receive $400 monthly, $450 for ages 6-11, and $485 for ages 12 and older. Special needs children can qualify for up to $1147 monthly.
- New York: The monthly adoption subsidy ranges from $420-$1,123 depending on factors like the foster care payment amount, child’s needs, and family size.
- Texas: Monthly adoption assistance payments range from $400-$545 per month depending on the child’s service level and age.
So in general, $300 to $600+ seems to be a typical monthly adoption assistance amount, but it can go up much higher in some cases or for children with greater needs.
Getting financial help for adopting a grandchild
If you’re hoping to get financial assistance for adopting your grandchild, here are some tips:
- Discuss options with your caseworker. Let your foster care or adoption caseworker know you’re interested in subsidies or other benefits to help cover adoption costs. They can advise what’s available.
- Understand eligibility requirements. Make sure your grandchild qualifies based on age, special needs status, and other criteria before pursuing benefits.
- Keep good records. Document your grandchild’s medical needs, disabilities, or behavioral challenges to help show the need for support. Track foster care payments. Save all adoption receipts.
- Compare benefits packages. If given options, look at the total value of benefits like monthly payments, Medicaid, and reimbursements.
- Claim tax credits. Be sure to claim the federal adoption tax credit and any state credits or deductions you qualify for. These can help offset adoption expenses.
- Apply for assistance programs. Don’t forget to explore TANF, SSI, Social Security, and other programs both for your grandchild if eligible and potentially for yourself as the caretaker.
- Seek community resources. Check if local nonprofits, churches, or support groups offer any grants or relief funds for adoptive grandparents.
With some savvy planning and research, grandparents can potentially tap into enough resources to make adopting a grandchild more affordable. While raising another child in retirement isn’t easy, the right financial benefits can help cushion the costs.
Challenges grandparents adopting grandkids may face
Beyond just the financial considerations, grandparents deciding whether to adopt a grandchild should be prepared for some of the unique emotional, physical, legal and other challenges that come with adopting later in life.
Some of the key things to be aware of include:
- High energy requirements. Keeping up with young kids can be tiring at any age, but especially in your 50s, 60s or beyond. Assess your physical abilities.
- College costs. Will you be able to save for and pay for college once the child reaches young adulthood? This is a major expense.
- Retirement plan impacts. You may need to delay retirement or go back to work if adopting affects your income, savings, or Social Security plans.
- Legal issues. Adopting as a grandparent involves termination of parental rights, navigating the foster system, and establishing permanency, which can get complicated.
- Long-term planning. Consider if you’re able to care for this child into adulthood and have plans in place if you pass away or become incapacitated.
- Family conflict. Adopting against your own child’s wishes can cause pain and strain with your children and other family members.
- Loss of leisure time. Adopting later in life often means losing much of the leisure and freedom that comes with an empty nest. Are you prepared for that sacrifice?
- Special needs. If your grandchild has special needs, this requires additional financial, emotional, and time commitments. Make sure you have the resources in place.
With honest self-reflection and careful planning, however, many grandparents feel the rewards outweigh the hardships. Don’t hesitate to get counseling or join grandfamilies support groups to help navigate the unique issues adoption may surface.
Government assistance programs
Beyond direct adoption subsidies, a number of government programs provide help to low-income adoptive families or children with special needs:
The Special Supplemental Nutrition Program for Women, Infants and Children (WIC) provides access to nutritious foods, nutrition education, breastfeeding support and health care referrals. Grandparents raising adopted children under 5 may qualify for WIC benefits based on income eligibility.
The Child and Adult Care Food Program (CACFP) subsidizes meals and snacks for children in licensed daycare homes. Adoptive grandparents who provide license daycare may qualify, as well as those whose children are in an eligible care program.
Head Start and Early Head Start programs support early learning and development through services for pregnant mothers, infants and toddlers and preschoolers. Adopted children in low-income families may qualify.
Child care subsidies
Government assistance with paying for child care may be available, especially for adoptive families who meet low-income requirements. Subsidy programs are administered at the state level.
For adoptive grandparents of kids with special needs, respite care provides short-term breaks by having someone temporarily care for the child. Some state programs fund respite services.
Medicaid often covers in-home or community-based services like speech, behavioral and physical therapy for children with qualifying conditions. This can provide extra help for adoptive grandparents.
So in addition to adoption-specific financial benefits, tapping into programs like these may help relieve some of the burden that comes with raising another child later in life. Support is out there if you know where to look.
Seeking community support
Besides government help, there are also community resources and charitable organizations that may offer a helping hand to grandfamilies. Some options to explore include:
- Religious groups. Many churches and faith-based charities offer fundraising assistance or grants for adoption expenses. There are also support groups specifically for grandparents raising grandchildren.
- Nonprofit associations. Various national and local nonprofits provide programs, resources and grants for grandfamilies, including groups like Generations United, Grandfamilies of America, and the Brookdale Foundation.
- Area Agencies on Aging (AAA). Local AAA offices assist older adults in accessing services, and may provide help for grandparents navigating adoption, foster care, or custody issues.
- Online support networks. Sites like Grandfamilies.org let you connect with other grandfamilies who understand the unique joys and challenges you’re facing. There are also Facebook community groups.
- Crowdfunding. Using GoFundMe or similar sites for adoption-related fundraising has become more commonplace for prospective adoptive parents struggling with expenses.
By combining public assistance with help from community programs and nonprofits, many grandparents piece together enough support to make adoption possible. With planning and outreach, you may be surprised at the resources available if you ask.
Adoption vs. guardianship for grandparents
Besides adoption, the other option for grandparents seeking formal custody is legal guardianship or standby guardianship arrangements. Here’s an overview of how adoption compares:
- Permanence. Adoption is permanent, while guardianship transfers could be contested or changed.
- Full legal rights. With adoption, grandparents gain full parental rights. Guardians have limited rights and the parents may still be involved.
- Financial benefits. Adoption opens up all adoption subsidies and tax credits. Subsidized guardianships are only in some states.
- Stability. Adoption may provide more family stability from both legal and emotional standpoints.
- Less conflict. Guardianship may be better for sharing custody with parents to avoid family conflict.
- Shorter time frame. Guardianship can be quicker than adoption, which involves terminations and home studies.
- Parental involvement. Some guardianship arrangements still allow parental contact, which the kids may prefer.
- Medical consent. Guardians can’t always make medical decisions like parents can.
- Kid’s preferences. If kids don’t want to be fully adopted, guardianship may be the better fit.
For school enrollment, health insurance coverage, consent for medical treatment, tax benefits and other needs, talk through the differences with your family law attorney to guide the best custody choice.
Handling costly legal processes
The legal procedures involved in terminating parental rights and adopting as a grandparent involve court expenses, attorney fees and other costs. Here are some ideas that could help ease the financial burden:
- Pro bono programs. Many attorneys donate a portion of hours to pro bono clients who can’t afford standard rates. Reach out to local legal aid societies to find options.
- Sliding fee scales. Some family lawyers may use income-based sliding fee scales so fees are based on what you can pay. Ask attorneys about flexible rates.
- Payment plans. Make arrangements to break up adoption legal fees into a long-term installment plan that works for your budget.
- Use savings. Dip into retirement savings if need be, since this is a worthy investment in your family’s future. Or use home equity.
- Crowdfund. Ask trusted friends and family to contribute to the legal costs through an online fundraising campaign.
- Grants and aid. Groups like the Gift of Adoption Foundation and National Adoption Foundation offer grants specifically to help cover adoption expenses.
- Adoption loans. An adoption loan through a nonprofit lender like National Adoption Foundation could help manage the upfront legal costs and get reimbursed later through the adoption tax credit.
- Tax deductions. Get credit for your legal fees through the adoption tax credit – you may later recoup some of what you paid.
Final thoughts on grandparent adoption financial help
The decision about whether adopting your grandchild is the right choice involves weighing many factors – time, health, family dynamics, and of course financial considerations. While raising another child in your 50s, 60s or beyond may sound daunting, know that you’re not alone.
With around 2.7 million grandparents in America serving as primary caregivers to grandchildren living with them, there are many families navigating this journey. And there are resources available, from adoption subsidies to tax credits to community groups providing a helping hand.
While becoming an adoptive grandparent has its share of challenges, the bonds of family and love for your grandkids prevail for many. If adoption is the best pathway for providing your grandchildren the stable home they deserve, have hope. With planning and support, the obstacles can be overcome.