IRS lowered my refund by $4,082 and gave me a confusing explanation. Did I do something wrong?

If you have the Form 8839 included with your tax return, you should do the following.

1. Print that form 
2. Gather all of your adoption documentation 
3. Prepare a response to your letter of explanation
4. Include all of the items and a copy of the letter of explanation 
5. Send them to the address on the IRS letter (it doesn't hurt to include a copy of your 1040 signed and dated with your e-file date).

It will take some time for you to receive a response.  If you prefer you can try using the Taxpayer Advocate Service (TAS).  They are in place to assist in situations where you are unable to obtain resolution on your own.

1. You can click here to begin: TAS Qualifier Tool. or 
2. Submit a request for assistance - Form 911 Request for TAS Assistance (instructions are included)
3. Locate the local TAS Office for your area

This will get the process started for you.  It's not going to be a fast process because they are handling a large volume at this time. 

If you do not hear from TAS within one week of submitting Form 911, contact the Taxpayer Advocate office where you originally submitted your request. Incomplete information or requests submitted to a Taxpayer Advocate office outside of your geographical location may result in delays.