Chad and Jaqueline are married and have AGI of $150,000.In 2016 they adopted a child,while taking advantage of their employer's written adoption assistance program.The adoption cost $9,500,all of which was paid by the employer in accordance with the adoption plan.How much of the employer paid adoption costs may be excluded from their income?

Question

Quizplus · Accepted Answer

According to the IRS, in 2016, up to $13,460 of adoption assistance provided by an employer can be excluded from the employee's income. Since the adoption cost was $9,500 and the employer paid all of it, the entire amount can be excluded from Chad and Jaqueline's income, resulting in a decrease of their AGI by $9,500. Therefore, the correct answer is D.

Chad and Jaqueline Are Married and Have AGI of $150,000