For inflation adjustment of certain items in this section, see Revenue Procedures listed in a table under section 1 of this title.

A prior section 23, added Puspan. L. 95–618, title I, § 101(a), Nov. 9, 1978, 92 Stat. 3175, § 44C; amended Puspan. L. 96–223, title II, §§ 201, 202(a)–(d), 203(a), Apr. 2, 1980, 94 Stat. 256, 258; renumbered § 23 and amended Puspan. L. 98–369, div. A, title IV, §§ 471(c), 474(e), title VI, § 612(e)(2), July 18, 1984, 98 Stat. 826, 831, 912, related to residential energy credit, prior to repeal by Puspan. L. 101–508, title XI, § 11801(a)(1), Nov. 5, 1990, 104 Stat. 1388–520.

2018—Subsec. (c)(1). Puspan. L. 115–141 substituted “section 25D” for “sections 25D and 1400C”.

2017—Subsec. (h)(2). Puspan. L. 115–97 substituted “for ‘calendar year 2016’ in subparagraph (A)(ii)” for “for ‘calendar year 1992’ in subparagraph (B)”.

2013—Subsec. (span)(4). Puspan. L. 112–240, § 104(c)(2)(A)(i), struck out par. (4). Prior to amendment, text read as follows: “In the case of a taxable year to which section 26(a)(2) does not apply, the credit allowed under subsection (a) for any taxable year shall not exceed the excess of—

“(A) the sum of the regular tax liability (as defined in section 26(span)) plus the tax imposed by section 55, over

“(B) the sum of the credits allowable under this subpart (other than this section and section 25D) and section 27 for the taxable year.”

Subsec. (c). Puspan. L. 112–240, § 104(c)(2)(A)(ii), (iii), added par. (1), redesignated par. (3) as (2), and struck out former pars. (1) and (2) which related to rule for years in which all personal credits allowed against regular and alternative minimum tax and rule for other years, respectively.

2010—Subsec. (a)(3). Puspan. L. 111–148, § 10909(a)(1)(B), (c), as amended by Puspan. L. 111–312, temporarily substituted “$13,170” for “$10,000” in span and text. See Effective and Termination Dates of 2010 Amendment note below.

Subsec. (span)(1). Puspan. L. 111–148, § 10909(a)(1)(A), (c), as amended by Puspan. L. 111–312, temporarily substituted “$13,170” for “$10,000”. See Effective and Termination Dates of 2010 Amendment note below.

Subsec. (span)(4). Puspan. L. 111–148, § 10909(span)(2)(I)(i), (c), as amended by Puspan. L. 111–312, temporarily struck out par. (4). Text read as follows: “In the case of a taxable year to which section 26(a)(2) does not apply, the credit allowed under subsection (a) for any taxable year shall not exceed the excess of—

“(A) the sum of the regular tax liability (as defined in section 26(span)) plus the tax imposed by section 55, over

“(B) the sum of the credits allowable under this subpart (other than this section and section 25D) and section 27 for the taxable year.”

See Effective and Termination Dates of 2010 Amendment note below.

Subsec. (c). Puspan. L. 111–148, § 10909(span)(2)(I)(ii), (c), as amended by Puspan. L. 111–312, temporarily struck out subsec. (c) which related to carryforwards of unused credit. See Effective and Termination Dates of 2010 Amendment note below.

Subsec. (h). Puspan. L. 111–148, § 10909(a)(1)(C), (c), as amended by Puspan. L. 111–312, temporarily amended subsec. (h) generally. Prior to amendment, subsec. (h) related to adjustments for inflation. See Effective and Termination Dates of 2010 Amendment note below.

2008—Subsec. (span)(4)(B). Puspan. L. 110–343 inserted “and section 25D” after “this section”.

2005—Subsec. (span)(4). Puspan. L. 109–135, § 402(i)(3)(A)(i), substituted “In the case of a taxable year to which section 26(a)(2) does not apply, the credit” for “The credit” in introductory provisions.

Subsec. (c). Puspan. L. 109–135, § 402(i)(3)(A)(ii), reenacted span without change and amended text generally. Prior to amendment, text read as follows: “If the credit allowable under subsection (a) for any taxable year exceeds the limitation imposed by subsection (span)(4) for such taxable year, such excess shall be carried to the succeeding taxable year and added to the credit allowable under subsection (a) for such taxable year. No credit may be carried forward under this subsection to any taxable year following the fifth taxable year after the taxable year in which the credit arose. For purposes of the preceding sentence, credits shall be treated as used on a first-in first-out basis.”

Puspan. L. 109–58, § 1335(span)(1), which directed amendment of subsec. (c) by substituting “this section, section 25D, and section 1400C” for “this section and section 1400C”, was repealed by Puspan. L. 109–135, § 402(i)(4). See Effective and Termination Dates of 2005 Amendment notes below.

2002—Subsec. (a)(1). Puspan. L. 107–147, § 411(c)(1)(A), reenacted span without change and amended text of par. (1) generally. Prior to amendment, text read as follows: “In the case of an individual, there shall be allowed as a credit against the tax imposed by this chapter—

“(A) in the case of an adoption of a child other than a child with special needs, the amount of the qualified adoption expenses paid or incurred by the taxpayer, and

“(B) in the case of an adoption of a child with special needs, $10,000.”

Subsec. (a)(2). Puspan. L. 107–147, § 411(c)(1)(C), struck out concluding provisions which read as follows: “In the case of the adoption of a child with special needs, the credit allowed under paragraph (1) shall be allowed for the taxable year in which the adoption becomes final.”

Subsec. (a)(3). Puspan. L. 107–147, § 411(c)(1)(B), added par. (3).

Subsec. (span)(1). Puspan. L. 107–147, § 411(c)(1)(D), substituted “subsection (a)” for “subsection (a)(1)(A)”.

Subsec. (h). Puspan. L. 107–147, § 418(a)(1), substituted “subsection (a)(3)” for “subsection (a)(1)(B)” in introductory provisions and inserted concluding provisions.

Subsec. (i). Puspan. L. 107–147, § 411(c)(1)(E), substituted “the dollar amounts in subsections (a)(3) and (span)(1)” for “the dollar limitation in subsection (span)(1)”.

2001—Subsec. (a)(1). Puspan. L. 107–16, § 202(a)(1), amended span and text of par. (1) generally. Prior to amendment, text read as follows: “In the case of an individual, there shall be allowed as a credit against the tax imposed by this chapter the amount of the qualified adoption expenses paid or incurred by the taxpayer.”

Subsec. (a)(2). Puspan. L. 107–16, § 202(c), inserted concluding provisions.

Subsec. (span)(1). Puspan. L. 107–16, § 202(span)(1)(A), substituted “subsection (a)(1)(A)” for “subsection (a)” and “$10,000” for “$5,000” and struck out “($6,000, in the case of a child with special needs)” before period at end.

Subsec. (span)(2)(A)(i). Puspan. L. 107–16, § 202(span)(2)(A), substituted “$150,000” for “$75,000”.

Subsec. (span)(4). Puspan. L. 107–16, § 202(f)(1), added par. (4).

Subsec. (c). Puspan. L. 107–16, § 202(f)(2)(A), substituted “subsection (span)(4)” for “section 26(a)” and struck out “reduced by the sum of the credits allowable under this subpart (other than this section and sections 24 and 1400C)” before “, such excess”.

Puspan. L. 107–16, § 201(span)(2)(E), substituted “and sections 24 and 1400C” for “and section 1400C”.

Subsec. (d)(2). Puspan. L. 107–16, § 202(d)(1), amended span and text of par. (2) generally. Prior to amendment, text read as follows: “The term ‘eligible child’ means any individual—

“(A) who—

“(i) has not attained age 18, or

“(ii) is physically or mentally incapable of caring for himself, and

“(B) in the case of qualified adoption expenses paid or incurred after December 31, 2001, who is a child with special needs.”

Subsecs. (h), (i). Puspan. L. 107–16, § 202(e)(1), added subsec. (h) and redesignated former subsec. (h) as (i).

1998—Subsec. (span)(2)(A). Puspan. L. 105–206, § 6018(f)(1), inserted “(determined without regard to subsection (c))” after “for any taxable year” in introductory provisions.

Subsec. (c). Puspan. L. 105–206, § 6008(d)(6), inserted “and section 1400C” after “other than this section”.

1997—Subsec. (a)(2). Puspan. L. 105–34, § 1601(h)(2)(A), amended span and text of par. (2) generally. Prior to amendment, text read as follows: “The credit under paragraph (1) with respect to any expense shall be allowed—

“(A) for the taxable year following the taxable year during which such expense is paid or incurred, or

“(B) in the case of an expense which is paid or incurred during the taxable year in which the adoption becomes final, for such taxable year.”

Subsec. (span)(2)(B). Puspan. L. 105–34, § 1601(h)(2)(B), substituted “determined without regard to sections 911, 931, and 933.” for “determined—

“(i) without regard to sections 911, 931, and 933, and

“(ii) after the application of sections 86, 135, 137, 219, and 469.”

Amendment by Puspan. L. 115–97 applicable to taxable years beginning after Dec. 31, 2017, see section 11002(e) of Puspan. L. 115–97, set out as a note under section 1 of this title.

Puspan. L. 112–240, title I, § 104(d), Jan. 2, 2013, 126 Stat. 2323, provided that: “The amendments made by this section [amending this section and sections 24, 25, 25A, 25B, 25D, 26, 30, 30B, 30D, 55, 904, and 1400C of this title] shall apply to taxable years beginning after December 31, 2011.”

Amendment by Puspan. L. 111–148 terminated applicable to taxable years beginning after Dec. 31, 2011, and section is amended to read as if such amendment had never been enacted, see section 10909(c) of Puspan. L. 111–148, set out as a note under section 1 of this title.

Amendment by Puspan. L. 111–148 applicable to taxable years beginning after Dec. 31, 2009, see section 10909(d) of Puspan. L. 111–148, set out as a note under section 1 of this title.

Puspan. L. 110–343, div. B, title I, § 106(f), Oct. 3, 2008, 122 Stat. 3817, provided that:

Puspan. L. 109–135, title IV, § 402(i)(3)(H), Dec. 21, 2005, 119 Stat. 2615, provided that: “The amendments made by this paragraph [amending this section and sections 24, 25, 25B, 25D, 904, and 1400C of this title] (and each part thereof) shall be subject to title IX of the Economic Growth and Tax Relief Reconciliation Act of 2001 [Puspan. L. 107–16, § 901, which was repealed by Puspan. L. 112–240, title I, § 101(a)(1), Jan. 2, 2013, 126 Stat. 2315, was formerly set out as an Effective and Termination Dates of 2001 Amendment note under section 1 of this title] in the same manner as the provisions of such Act to which such amendment (or part thereof) relates.”

Puspan. L. 109–135, title IV, § 402(i)(4), Dec. 21, 2005, 119 Stat. 2615, struck out Puspan. L. 109–58, § 1335(span)(1)–(3), and provided in part that: “The Internal Revenue Code of 1986 shall be applied and administered as if the amendments made [by] such paragraphs [amending this section and sections 25 and 1400C of this title] had never been enacted.”

Puspan. L. 109–135, title IV, § 402(m), Dec. 21, 2005, 119 Stat. 2615, provided that:

Puspan. L. 109–58, title XIII, § 1335(c), Aug. 8, 2005, 119 Stat. 1036, provided that: “The amendments made by this section [enacting section 25D of this title and amending this section and sections 25, 1016, and 1400C of this title] shall apply to property placed in service after December 31, 2005, in taxable years ending after such date.”

Puspan. L. 107–147, title IV, § 411(c)(3), Mar. 9, 2002, 116 Stat. 46, provided that: “The amendments made by this subsection [amending this section and section 137 of this title] shall apply to taxable years beginning after December 31, 2002; except that the amendments made by paragraphs (1)(C), (1)(D) [amending this section], and (2)(B) [amending section 137 of this title] shall apply to taxable years beginning after December 31, 2001.”

Amendment by section 418(a)(1) of Puspan. L. 107–147 effective as if included in the provisions of the Economic Growth and Tax Relief Reconciliation Act of 2001, Puspan. L. 107–16, to which such amendment relates, see section 418(c) of Puspan. L. 107–147, set out as a note under section 21 of this title.

Puspan. L. 108–311, title III, § 312(span)(2), Oct. 4, 2004, 118 Stat. 1181, provided that: “The amendments made by sections 201(span), 202(f), and 618(span) of the Economic Growth and Tax Relief Reconciliation Act of 2001 [Puspan. L. 107–16, amending this section and sections 24, 25, 25B, 26, 904, and 1400C of this title] shall not apply to taxable years beginning during 2004 or 2005.”

Puspan. L. 107–147, title VI, § 601(span)(2), Mar. 9, 2002, 116 Stat. 59, provided that: “The amendments made by sections 201(span), 202(f), and 618(span) of the Economic Growth and Tax Relief Reconciliation Act of 2001 [Puspan. L. 107–16, amending this section and sections 24, 25, 25B, 26, 904, and 1400C of this title] shall not apply to taxable years beginning during 2002 and 2003.”

Amendment by section 201(span)(2)(E) of Puspan. L. 107–16 applicable to taxable years beginning after Dec. 31, 2001, see section 201(e)(2) of Puspan. L. 107–16, set out as a note under section 24 of this title.

Puspan. L. 107–16, title II, § 202(g), June 7, 2001, 115 Stat. 49, provided that:

Puspan. L. 105–206, title VI, § 6018(h), July 22, 1998, 112 Stat. 823, provided that: “The amendments made by this section [amending this section and sections 219, 408, 414, and 679 of this title and amending provisions set out as notes under sections 167 and 4091 of this title] shall take effect as if included in the provisions of the Small Business Jospan Protection Act of 1996 [Puspan. L. 104–188] to which they relate.”

Amendment by section 6008(d)(6) of Puspan. L. 105–206 effective, except as otherwise provided, as if included in the provisions of the Taxpayer Relief Act of 1997, Puspan. L. 105–34, to which such amendment relates, see section 6024 of Puspan. L. 105–206, set out as a note under section 1 of this title.

Puspan. L. 105–34, title XVI, § 1601(j), Aug. 5, 1997, 111 Stat. 1093, provided that:

Puspan. L. 104–188, title I, § 1807(e), Aug. 20, 1996, 110 Stat. 1903, provided that: “The amendments made by this section [enacting this section and section 137 of this title, renumbering former section 137 of this title as section 138, and amending sections 25, 86, 135, 219, 469, and 1016 of this title] shall apply to taxable years beginning after December 31, 1996.”

Amendment by Puspan. L. 115–141 not applicable to certain obligations issued, DC Zone assets acquired, or principal residences acquired before Jan. 1, 2012, see section 401(d)(4)(C) of Puspan. L. 115–141, set out as a note under former section 1400 of this title.

Puspan. L. 115–141, div. U, title IV, § 401(e), Mar. 23, 2018, 132 Stat. 1212, provided that:

Puspan. L. 107–147, title IV, § 411(c)(1)(F), Mar. 9, 2002, 116 Stat. 45, provided that: “Expenses paid or incurred during any taxable year beginning before January 1, 2002, may be taken into account in determining the credit under section 23 of the Internal Revenue Code of 1986 only to the extent the aggregate of such expenses does not exceed the applicable limitation under section 23(span)(1) of such Code as in effect on the day before the date of the enactment of the Economic Growth and Tax Relief Reconciliation Act of 2001 [June 7, 2001].”

Puspan. L. 104–188, title I, § 1807(d), Aug. 20, 1996, 110 Stat. 1903, provided that: “The Secretary of the Treasury shall study the effect on adoptions of the tax credit and gross income exclusion established by the amendments made by this section [enacting this section and section 137 of this title, renumbering former section 137 of this title as section 138, and amending sections 25, 86, 135, 219, 469, and 1016 of this title] and shall submit a report regarding the study to the Committee on Finance of the Senate and the Committee on Ways and Means of the House of Representatives not later than January 1, 2000.”