Adoption and surrogacy can be wonderful journeys for both parents and children. 


Having a family is something that many people dream of, but sometimes building one isn’t as easy as it seems—especially financially. 


You see, both adoption and surrogacy involve legal fees, medical expenses, travel costs and other related financial implications.


Therefore, it’s critical to understand how these choices impact your bottom line before moving forward. Doing so will help you to achieve your dreams without compromising your personal financial security in the process. 

What Are Some Surrogacy Costs 

Using a surrogate in California can cost between $85,000 and $150,000 give or take a few thousand. 


This cost includes the payment for the surrogate, medical expenses for the screening and monitoring as well as the IVF procedure and can increase depending on your circumstances, needs, and specific requirements 


For instance, if you’re using a donor’s eggs, then you’ll have to pay the donor an additional $25,000 to $35,000. 


Insurance coverage in surrogacy is often limited, and you’ll have to pay extra to cover the costs of the delivery. 


When looking for a surrogacy agency, make sure to factor in their fees, which range from $25,000 to $50,000 adding to the total cost.

What Are Some Adoption Costs?

Adoption costs vary depending on the type of adoption and the adoption agency you choose. 


Private and international adoptions are likely to cost more than adoptions through the foster care system. 


The average cost of adoption in California is between $10,000 and $50,000. This range includes the cost of home inspections, court fees, and attorney fees. 


Adoption agencies also have fees that can range from $4,000 to $30,000.


When adopting, you may also want to factor in the costs of the child’s medical expenses, travel expenses, and the cost of compliance, if applicable.

Are There Tax Implications?

Surrogacy and adoption have differing tax implications. 


The Internal Revenue Service (IRS) considers surrogacy payments made to a surrogate as compensation for services rendered. 


Therefore, the intended parents will have to pay employment taxes on the surrogate’s compensation. 


On the other hand, adoptive parents can qualify for an adoption tax credit of up to $15,950 in 2023. The credit helps offset the costs associated with adoption, including home study fees, background checks as well as the legal fees, as well as travel expenses and changes yearly.

Possible Insurance Coverage

Insurance coverage is limited in both surrogacy and adoption. 


In surrogacy, the surrogate’s insurance may cover some aspects of the procedure, such as maternity costs incurred during pregnancy. 


However, you’ll have to pay extra to cover the costs of delivery and any complications that may arise. 


In adoption, the child’s medical expenses are an important consideration but luckily it is recognized as a qualifying life event and your child can be added as a special enrollment.


Additionally, California has The Adoption Assistance Program (AAP) which is an entitlement program to provide financial and medical coverage to facilitate the adoption of children who otherwise would remain in long-term foster care.


Just remember to keep in mind that the costs of surrogacy and adoption often vary significantly. 

To avoid surprises, it’s advisable to consult with an attorney who specializes in surrogacy or adoption law. They can give you more specific information on the costs you may incur for your unique situation. 


Have questions? Need guidance on your surrogacy or adoption journey? Contact our office today. We are here to assist you!