Problem 7-22 Adoption Expenses (LO 7.7) Carl and Jenny adopt a Korean orphan. The adoption takes 2 years and two trips to Korea and is finalized in 2022. They pay $8,000 in 2021 and $7,500 in 2022 for qualified adoption expenses. In 2022, Carl and Jenny have AGI of $150,000. If an amount is zero, enter "0". If required, carry any division out to four decimal places and round final answers to the nearest dollar. a. What is the adoption credit Carl and Jenny can claim in 2022? 14,440 X Feedback Check My Work Taxpayers are allowed two tax breaks for adoption expenses. A tax credit is allowed for qualified adoption expenses paid by taxpayers, and an exclusion from W-2 income is allowed for qualified adoption expenses paid by taxpayers' employers. Form 8839 is used to calculate and report the adoption credit. There is a limitation on the total expense that can be taken as a credit with respect to an adoption of a child. The credit is the total amount for each adoption and is not an annual amount. The amount of the credit allowable for any tax year is reduced for taxpayers with AGI over $216,660 and is fully phased out when AGI reaches $263,410. b. How much credit could they claim if the adoption falls through and is never finalized? Feedback Check My Work Correct c. How much credit could they claim if their AGI was $229,410? 12,528 X Feedback Check My Work Incorrect Feedback Check My Work Partially correct