Fairness for Adopting Families Act

Fairness for Adopting Families Act - Amends the Internal Revenue Code to permit an individual income tax deduction for qualified adoption expenses. Includes as deductible all reasonable and necessary expenses that do not violate a Federal or State law and that are directly related to a legal adoption of any child if the adoption has been arranged by a State, local, or other nonprofit agency, or through a private placement. Limits the deduction to $5,000 per adopted child ($7,000 in the case of an international adoption). Reduces the amount of the deduction when the taxpayer's income exceeds $60,000.

Disallows such a deduction for expenses in connection with: (1) the adoption of a stepchild; or (2) travel outside the United States unless the travel is required as a condition of the child's adoption, to assess the health and status of the child, or to escort the child back to the United States.

Excludes such a deduction from the two percent floor on miscellaneous itemized deductions.

Excludes from an employee's gross income any amounts paid on behalf of the employee by an employer pursuant to a qualified adoption assistance program. Limits the exclusion to $5,000 ($7,000 in the case of an international adoption). Reduces the amount excluded when the taxpayer's income exceeds $60,000.

Permits an employer to treat an adoption assistance program as a statutory employee benefit plan, thus making the employer's contributions to such a program tax deductible as business expenses.

Applies this Act retroactively to tax year 1986 and thereafter.