Adoption assistance benefits are not hard for businesses to add
Q&A with Brandon Longpublished in The Oklahoman | September 10, 2014
Adopting a child can be expensive, but there’s good news for employers who want to help their employees defray those costs. Establishing an employer-sponsored adoption assistance plan is relatively easy, and it offers some nice tax benefits, said McAfee & Taft attorney Brandon Long in an interview with The Oklahoman.
According to Long, the plan should include written documentation that specifies who is eligible to receive the benefit, the types of expenses paid by the employer, the maximum amount paid or reimbursed, the documentation required in order to obtain the payment or reimbursement, and certain other legal language.
“Subject to certain limitations, amounts paid under an adoption assistance plan generally are excludable from an employee’s income,” said Long. Although such amounts are not subject to federal income tax withholding, they would be subject to certain other withholdings, including withholdings for federal Social Security and Medicare tax (FICA) and federal unemployment tax (FUTA), he explained.