Like other FSAs, the dependent care FSA allows you to fund your account with pretax dollars. But this account is for eligible child and adult care expenses. This includes preschool, nursery school, day care, before and after school care and summer day camp. It's the care your family needs, while you're at work. For detailed rules about dependent care FSAs, see IRS Publication 503.
Get some financial relief with a dependent care FSA. Contribute up to $5,000 pretax for the plan year. After your dependents receive care, you can submit claims to pay yourself back. Just be sure to use all your funds during the plan year. Unused funds won’t roll over to the next year.
Always on the go? With the PayFlex Mobile app, you can view your balance, check account activity and submit claims in just a few taps.
With this tax savings calculator, you can plug in your numbersfootnote1 and see how much you might save with a dependent care FSA.
footnote†For best estimate, enter an amount less than or equal to the pretax contribution limit of $5,000.
Check out the list of common eligible dependent care expenses. Use the search bar to find specific services. Or you can click on the column headers in the table to see which are eligible or not eligible.
When you enroll in a dependent care FSA, you set aside money from your paycheck on a pretax basis for eligible child and adult care expenses. Your expenses must be work-related. This means that your dependents need the care so that you can work. During the plan year, you’ll pay for your eligible dependent care expenses out of pocket. Once your dependent receives the care, you can submit a claim to pay yourself back from your FSA. You can do this online, through the PayFlex Mobile® app, or complete a paper claim and fax or mail it to us.
A dependent care FSA does have a few rules that you should know:
Typically, the most that you can contribute to a dependent care FSA is $5,000. This is per household per year. This means that if you and your spouse each have a dependent care FSA, you’re limited to $5,000 between you. Keep in mind, this amount may be less based on earned income and tax filing status. For example, if you’re married and filing taxes separately, your individual contribution limit is $2,500.
You can submit a claim at any time during the plan year. However, you can only receive reimbursement after the dates of service.
Example: You pre-pay your dependent care provider every Friday for the following week. To receive reimbursement, you must wait until the end of the next week to submit your claim.
When you submit a claim, we need the detail for that expense. You only need to send one of the following with your claim form:
Yes. When you have a dependent care FSA, you must include this information as part of your tax return. You’ll do this on IRS Form 2441: Child and Dependent Care Expenses. For more information, see instructions for IRS Form 2441 at www.irs.gov. Your employer will also list your contributions on your Form W-2. If you have questions, you should speak with your tax adviser.
Generally, if you have a dependent care FSA you can’t also take the full tax credit. You should talk to your tax adviser to learn which option is best for you.
You can submit a claim for the full amount. The FSA will reimburse you up to the balance in your account. You’ll only receive reimbursement for the remaining amount if additional contributions are made to your FSA.
This is not an eligible expense. The dependent care must be provided so you can work. Since you’re not working during this period, the day care expense is not reimbursable.
No. Care must be for a qualifying person. A qualifying person includes your dependent child who is younger than age 13. This would only be an eligible expense if your child wasn’t able to care for him or herself.
No. This is not an eligible expense. If the care provider is your child, they can’t be your tax dependent. They must also be 19 or older by the end of the year.
footnote1You’ll want to add up your total dependent care expenses per year for children under 13, elderly parents, spouse or other relative(s) incapable of self-care who spend at least 8 hours each day in your home. Eligible expenses include preschool, nursery school, day care, care before and after school care and summer day camp.
footnote2Savings estimates assume annual IRS FSA contribution limits or your total expenses, whichever is less. Talk with your employer to learn the exact limits for your plan. For this calculation, we used a savings of 21% to assume federal, state and social security taxes you may avoid with pretax contributions. This calculation is just an estimate. It isn’t tax advice. Ask your tax advisor to find out how much you might save by making pretax contributions. Actual tax savings depends on many things. Some of these include state and local tax rates, your tax bracket and the FICA tax rate.