Stillbirth Tax Credit: Which States Offer Tax Relief and How to Claim It

The Federal Rule (and Why It Matters)

The IRS does not allow a stillborn child to be claimed as a dependent on federal tax returns. To qualify as a dependent, the child must have been born alive — a requirement documented in IRS Publication 501. This applies regardless of gestational age or how far along the pregnancy was.

This is a hard line, and it feels cruel to many families who incurred significant medical and funeral expenses. Several states have responded by creating their own tax relief measures.

States That Offer Stillbirth Tax Credits

The following states provide a tax credit or personal exemption for families who experience a stillbirth. Eligibility generally requires a Certificate of Birth Resulting in Stillbirth or an equivalent fetal death record.

Minnesota — $2,000 Refundable Credit

Minnesota offers a $2,000 refundable tax credit (meaning you receive the full amount even if your tax liability is below $2,000). The loss must occur at 20 or more weeks of gestation. You file Schedule M1PSC and Schedule M1REF with your Form M1. Required documentation: the State File Number and Document Control Number from the Certificate of Birth Resulting in Stillbirth. Claims can be filed retroactively back to tax year 2016 if completed before January 1, 2026.

Connecticut — $2,500 Nonrefundable Credit

A $2,500 nonrefundable credit for losses at 20 or more weeks. Eligible claimants include parents, grandparents, or their representing attorneys. Requires a Certificate of Birth Resulting in Stillbirth issued by Connecticut vital records.

Nebraska — $2,000 Refundable Credit

A $2,000 refundable credit. Requires a Certificate of Birth Resulting in Stillbirth issued in the tax year of the loss, at 20 or more weeks of gestation.

Wisconsin — $2,000 Nonrefundable Credit

A $2,000 nonrefundable credit effective for tax years starting after December 31, 2025. Requires a fetal death report under state law (20+ weeks). For married filing separately or unmarried parents, each can claim $1,000.

Arizona — $2,300 Personal Tax Exemption

A personal tax exemption rather than a credit. Applies to losses at 20 or more weeks of gestation or 350 or more grams birth weight. Requires a Certificate of Birth Resulting in Stillbirth.

Kansas — $2,320 Personal Tax Exemption

Similar to Arizona's structure. Applies to losses at 20 or more weeks. Requires a Commemorative Certificate of Stillbirth issued by the state vital records office.

Arkansas — $500 Credit (Paisley's Law)

A $500 individual income tax credit for losses at 20 or more weeks. Requires a Certificate of Birth Resulting in Stillbirth.

North Dakota — One-Time Tax Deduction

An individual income tax deduction (amount adjusted for inflation) for losses at 20 or more weeks. Requires a certified copy of the Fetal Death Record from the Department of Health.

Maryland — $1,000 Refundable Credit (Pending)

Senate Bill 356 creates a $1,000 refundable credit for losses at 20 or more weeks. Effective for tax years 2027 and beyond. Accepts a Certificate of Birth Resulting in Stillbirth or equivalent fetal death certificate from another state.

How to Get the Certificate

The Certificate of Birth Resulting in Stillbirth is separate from the fetal death report that the hospital files. In most states, you must request the certificate from your state's vital records office. The hospital or funeral home can usually point you to the correct agency.

Some states issue the certificate automatically when a fetal death report is filed. Others require a separate application. Processing time ranges from a few weeks to several months depending on the state.

If your loss occurred in a state that does not offer a tax credit but you file taxes in a state that does (for example, you delivered in a bordering state while residing in a credit-eligible state), check whether your home state accepts out-of-state fetal death documentation. Maryland's pending law explicitly allows certificates from other states.

What This Does Not Cover

These credits address state income tax only. They do not:

• Change your federal tax return
• Cover medical or funeral expenses directly (though the expenses themselves may be deductible if they exceed the standard threshold)
• Affect eligibility for other benefits like Social Security survivor benefits (those require a live birth)

The Filing Checklist

1. Obtain a certified copy of the Certificate of Birth Resulting in Stillbirth (or fetal death record) from your state vital records office
2. Confirm your state offers a credit and check the gestational threshold
3. Locate the correct state tax form or schedule (your state revenue website will list it)
4. Attach the certificate copy to your state tax return
5. If filing jointly, confirm whether both parents can claim the credit or whether it is split

The Grief During Pregnancy guide includes the complete financial protections checklist — covering stillbirth tax credits, funeral financial assistance programs, short-term disability claims, and the administrative filing timeline — organized by deadline urgency.