BILL NUMBER: S7884

SPONSOR: SALAZAR
 
TITLE OF BILL:

An act to amend the tax law, in relation to providing for a deduction
from personal gross income for expenses incurred in the adoption of a
child in the foster care system

 
PURPOSE OR GENERAL IDEA OF THE BILL:

To create incentives to decrease the number of children in foster care
waiting to be adopted; this legislation creates a tax deduction for all
expenses incurred by family adopting children from the foster care
system.

 
SUMMARY OF SPECIFIC PROVISIONS:

Section 1: Tax Law section 612 (c) is amended by adding a new paragraph
48 which lists income tax deductibles for eligible families adopting a
child in the foster care system.

              

Section 2: Provides for an immediate effective date and shall apply to
all taxable years beginning on or after the first of January in the year
in which it shall have become law.

 
JUSTIFICATION:

Currently, New York State has over 23,000 children in custody in its
foster care system. For many of these children, returning to their
natural parents is impossible. In 2011, there were over 6,400 foster
care children waiting to be adopted and the median years each has to
wait to be adopted is close to 4.5 years.

At an annual cost to New York State of over $33,000 per child in state
custody, it is obvious that New York State government must do more to
create incentives for families interested in adopting a child in the
foster care system. This legislation gives adoptive families an income
tax deduction for all the expenses incurred in such an adoption. In
addition, it is a well understood dynamic that the longer a child is in
the foster care system, the slimmer the chances for adoption. As chil-
dren age in state custody it becomes a negative for them because fami-
lies tend to adopt younger children. Therefore New York must do more to
place these children in healthy, loving and nurturing home environments.
At a total annual cost of over $759 million dollars to maintain the
23,000 in state custody, it is clearly in the best interest of these
children and to New York taxpayers to create incentives to reduce the
number of children in government custody.

 
PRIOR LEGISLATIVE HISTORY:

SENATE:

2023-2024: S598A (Salazar) Referred to Budget and Revenue

2021-2022: S6724 (Salazar)- Referred to Budget and Revenue

2020: S5084 (Salazar) - Referred to Budget and Revenue, Committed to
Finance
2019: S5084 (Salazar) - Referred to Budget and Revenue, Passed Senate

2018: S1354 (Alcantara) - Referred to Investigations and Gov't.  Oper-
ations, Reported and committed to Finance

2017: S1354 (Alcantara) - Referred to Investigations and Gov't.  Oper-
ations, Passed Senate

2016: S7685 (Espaillat) - Referred to Investigations and Gov't.  Oper-
ations

2015: S2026 (Hassell-Thompson)-Passed Senate, Passed Assembly, Vetoed by
Governor

2014: S3382A (Hassell-Thompson) - Referred to Investigations and Gov't.
Operations, Reported and committed to Finance, Reported, Passed Senate,
Passed Assembly, Vetoed by Governor

2013: S3382A (Hassel-Thompson)- Referred to Investigations and Gov't.
Operations, Committed to Finance, Passed Senate

2012: S6458 (Hassel-Thompson)- Referred to Investigations and Gov't.
Operations, Reported, Committed to Finance, Passed Senate

ASSEMBLY:

2023-2024: A9240 (Solages) - Referred to Ways and Means

2021-2022: A7811 (Solages) - Referred to Ways and Means

2019-2020: A6689(Crespo)- Referred to Ways and Means

2017-2018: A8193(Crespo)- Referred to Ways and Means

2016: A10154 (Crespo)- Referred to Ways and Means

 
FISCAL IMPLICATIONS FOR STATE AND LOCAL GOVERNMENT:

Currently, New York spends over $33,000 annually for each child in the
foster care system. In 2011, there were over 6,400 foster care children
waiting to be adopted, but only about 7% or 417 children were adopted.
Allowing families to deduct the estimated $2,000 to $10,000 in expenses
incurred to adopt a child reduces the amount paid in taxes to NYS by
less than $600 per each adoption. Obviously, it makes enormous economic
sense to lose $600 per adoption in tax collection by creating incentives
to remove children from state custody at the current yearly cost of over
$33,000 per child.

Based on 2009 total adoptions from. the foster care system, which placed
2,100 children with adoptive families, New York State tax collection
would be reduced by about one million dollars. However, with over 17,000
children currently (23,000 children in State custody in 2015), during
any given year, at the stated annual cost per child of over $33,000, the
state will actually achieve savings in excess of the projected decrease
in tax revenue for each child adopted due to the incentives provided in
this legislation.

 
EFFECTIVE DATE:
This bill will take effect immediately.