Dependent Care FSA Information

Dependent Care FSA Information ​

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Qualified Events & Enrollment

Additional life situations considered as Changes in Status or Qualifying events include: A change in cost or coverage related to a child care provider fee or a change in the number of hours of care needed. A change in marital status, such as marriage, divorce, or death of your spouse. A change in the number of your dependents, such as birth or adoption of a child, or death of a dependent. A change in employment status for you, your spouse, or dependent that affects eligibility. An event that causes your dependent to satisfy or cease to satisfy eligibility requirements.

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Contribution Limits

Generally, if both parents are married, working and filing taxes jointly, the maximum contribution is $5,000 annually. If you are single or married and filing separately, the limit is $2,500 annually. Every situation is unique, so the maximum amount may be less if the employee’s Earned Income or spouse’s Earned Income is less than $5,000 per year. To learn more about maximum contributions or earned income for those individuals earning less than $5,000 per year, see page 4 of IRS Publication 503.

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Who Is a Qualified Dependent?​

  1. A “Qualifying Person” is defined as one of the following:
  2. A dependent who was under age 13 when the care was provided and for whom an exemption can be claimed.
  3. A spouse who was physically or mentally not able to care for himself or herself and lived with you for more than half the year.
  4. A dependent who was physically or mentally not able to care for himself or herself and for whom an exemption can be claimed and lived with you for more than half the year.
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How Much Should You Contribute? ​

Determine your total annual amount of qualified dependent care expenses for the Plan Year. Your annual contribution to the Dependent Care FSA account must be within the minimum and maximum amounts set by your employer based on the maximum allowed by the IRS.

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Use It or Lose It Rule

There is no carryover option with a Dependent Care FSA Account so that means that at the end of the benefit plan year, all money must be claimed by the employee or the employer will assume the funds.

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Money In, Money Out ​

Unlike a Healthcare Flexible Spending Account where the annual election is available on the first day of a plan year, a Dependent Care FSA account is a money in/money out. Meaning, money is only available as you pay into the account.