Adoption Assistance Reimbursement Program
Northwestern University recognizes that families are built in many ways. In order to support eligible faculty and staff who are adoptive parents, the University offers an Adoption Assistance Reimbursement Program.
What is the Adoption Assistance Reimbursement Program?
The purpose of the Adoption Assistance Reimbursement Program is to provide reimbursement for all or a portion of the expenses resulting from the adoption of an Eligible Child. The Program is intended to satisfy the requirements of section 137 of the Internal Revenue Code of 1986, as amended (the “Code”), and to provide reimbursement to eligible employees that are excludable from federal gross income under section 137 of the Code.
All active full-time, benefits eligible faculty and staff, with at least three years of continuous service at the time of the adoption.
Qualified adoption expenses
- Adoption agency placement fees
- Attorney fees for the adoption
- Court costs for the adoption
- Reasonable and necessary transportation and lodging associated with the adoption
- Other reasonable expenses which are directly related to, and the principal purpose of which is for, the legal adoption of an Eligible Child (as defined below) by an eligible faculty or staff member
The following expenses are not reimbursable:
- Adoption of individuals eighteen years or older
- Expenses paid for carrying out a surrogate parenting arrangement
- Expenses paid in violation of state or federal law
- Expenses paid for establishing legal guardianship
- Expenses reimbursed, paid or funded under any state, local or federal program or other source. (For example, adoption assistance expense reimbursed through another employer.)
- Expenses claimed as a credit or deduction on your personal tax return
The term "Eligible Child" is defined as a an adopted child under the age of 18 at the time a qualified adoption expense is paid. An eligible child includes an unrelated child, a step child, or a child as a result of a surrogacy arrangement.
Adoption Assistance Reimbursement
Adoption assistance reimbursement is eligible for up to $5,000 with respect to any Eligible Child and up to $6,000 for a child with special needs. This is a limit on the total qualified adoption expenses that may be reimbursed in connection with any Eligible Child. There is also a limit of two adoptions per household for the lifetime of employment at Northwestern.
For example, if two University employees in the same household wish to seek reimbursement for a qualified adoption, they are eligible for a maximum of two adoption reimbursements during the lifetime of their employment at Northwestern. All adoptions covered under this reimbursement program must be finalized after the faculty or staff member has completed three years of employment at Northwestern.
To obtain reimbursement, the eligible employee must submit to the University all of the following information within six months of finalizing the adoption:
- Complete the Adoption Assistance Reimbursement Form and provide:
- Documentation of all fees, costs and other expenses incurred in connection with the adoption of an Eligible Child (including detailed receipts, invoices, canceled checks, etc.)
- Documentation that indicates whether the child is a citizen or resident of the United States
- For the adoption of an Eligible Child who is not a citizen or resident of the United States, a final decree of adoption by a competent authority of the foreign-sending country, as well as evidence that the child has been issued the appropriate visa from the State Department of the United States
- For the adoption of an Eligible Child who is a citizen or resident of the United States, a final decree of adoption
Tax exclusion or tax credit
The tax laws regarding the adoption tax credit are complicated and they affect different individuals in different ways. A professional tax advisor is your best source of information about whether you should seek payment of Qualifying Adoption Expenses from the Adoption Assistance Reimbursement Program or claim the adoption tax credit. While you may be entitled to claim both a credit and an exclusion from income for Qualified Adoption Expenses of an eligible child, both cannot be claimed on the same expenses. Because each taxpayer’s circumstances are unique, you should determine whether the credit or employer payment is more beneficial to you. The tax exclusion for Qualified Adoption Expenses begins to phase out for taxpayers with certain modified adjusted gross incomes (the phase out limits are published by the IRS annually). The University does not provide personal tax assistance. Please consult your tax advisor for more information. You may also obtain further information from IRS Form 8839, Qualified Adoption Expenses and its instructions that can be obtained from the IRS website.
The program will be administered by the WELL Team within the Office of Human Resources (or any individual or entity to whom the Vice President of Human Resources has authorized and empowered to issue uniform rules and adopt forms to be used in carrying out the purposes of the program). The program administrator may make and enforce such rules and regulations as is deemed necessary or proper for the efficient administration of the program. The program administrator will determine whether expenses are qualified adoption expenses eligible for reimbursement under the program. Additionally, the program administrator will have discretionary authority to interpret the program and decide any and all matters arising hereunder, including the right to remedy possible ambiguities, inconsistencies or omissions and make factual determinations.
Any such corrections, interpretations, determinations of the provisions of the program by the program administrator will be final, binding and conclusive upon all parties, including the University, employees, their families and dependents.
Amendment and termination
The program is subject to amendment or termination at any time, and for any reason, by the University or pursuant to a written instrument executed by the University’s Vice President of Human Resources.