Dependent Care FSA

Who takes care of your kids or elderly parents while you work? You can save money on the cost of day care, nursery school or summer day camp, when you use the Dependent Care Flexible Spending Account. For instance, if you spend $4,000 on day care you could save $400-$1,400 in taxes through the Dependent Care Flexible Spending Account. 

To be eligible for reimbursement, the care for your dependent child or elderly relative must enable you (and your spouse) to work, look for work or attend school full-time.

NOTE: Puerto Rico team members are not eligible to participate in the Limited-Purpose and/or Dependent Care Flexible Spending Accounts (FSAs).

 

How You Save

To get your savings, you simply decide in advance how much you’ll spend on these everyday items, then deposit money every paycheck into your account.

Minimum Annual Contribution Maximum Annual Contribution
$100 $5,000*

($1,200 for certain highly paid team members)

* If you are considered a highly paid team member, maximums may be lowered at and/or after enrollment to satisfy nondiscrimination requirements.

Plan Ahead

Look over your annual expenses. What do you expect to spend between this July and next June on dependent care? For many, dependent care expenses can be more predictable than health care expenses. Sample eligible expenses include:

  • Day care
  • Nursery school
  • Summer day camp
  • Day care costs for an elderly parent

See full list of eligible expenses.

  • Use it or lose it. The IRS requires that any money left over in your Flexible Spending Account at the end of the policy year be forfeited.

Saving is Automatic

Once you enroll, your contributions are deducted from your paycheck in equal installments throughout the year before taxes are withheld. The exact amount of your savings depends on your tax rate.

Get Reimbursed

  • File a claim, and wait for reimbursement. You’ll be reimbursed by the Flexible Spending Account administrator. When you get a dependent care bill, pay it out of your pocket. Then, submit your claim to the FSA administrator (online, fax or mail) and your check will be mailed to you. You’ll also need to submit your receipts (fax, online or mail). The year for the Flexible Spending Accounts is July 1 through June 30. Keep this in mind when you determine your contribution amount for the year. You have an additional three months—until September 30—to submit your receipts for reimbursement.

Important Rules

  • 12 months to use your money. The year for the Flexible Spending Accounts is July 1 through June 30. Keep this in mind when you determine your contribution amount for the year. You have an additional three months—until September 30—to submit your receipts for reimbursement of expenses incurred during the year.
  • Eligible expenses. For more detailed plan information and a list of eligible and ineligible expenses, see the Flexible Spending Accounts Summary Plan Description (SPD). In addition, IRS Publication 502 ("Medical and Dental Expenses") provides general guidance regarding health care expenses eligible for reimbursement; IRS Publication 503 ("Child and Dependent Care Expenses") contains a detailed explanation of eligible and ineligible dependent care expenses. These publications are available on the IRS website or by calling the IRS at 1-800-829-FORM (3676).
  • Separate tax return rules. If you are married and your spouse has a Dependent Care FSA through his or her employer, the combined total of your deposits cannot exceed $5,000. If you file separate tax returns, you and your spouse can each contribute up to $2,500.
  • Possible smaller tax savings. If you are considered a highly paid team member, maximums may be lowered after enrollment.
  • Claims after you leave the Company, no longer participate or become ineligible for the FSA. 

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