Dependent Care Flexible Spending Account

What It is

A Dependent Care Flexible Spending Account (Dependent Care FSA) is set up to reimburse employees for their eligible dependent care expenses, including daycare expenses for children under the age of 13, a disabled spouse and/or a disable relative or household member who depends on the account holder for at least half of his/her support. In order to participate, employees must elect the annual amount they want to contribute to their Dependent Care FSA, up to $5,000 (as determined by IRS Code section 125(i)), prior to the start of their employer’s benefit plan year. Each employer determines the maximum amount an employee may contribute to their dependent care FSA during a benefit plan year, so they may offer a lower annual maximum amount.

Wondering what qualifies as an “eligible expense”? Click below for a list of eligible FSA items.

How It Works

Throughout the course of the benefit plan year, a portion of the employee’s annual election amount will be deducted pre-tax from each paycheck to fund the account, until the annual election amount is reached. Unlike the Medical FSA, the Dependent Care account is not pre-funded, so employees are only able to spend what they have contributed in payroll deductions at a given time. Over the course of the benefit plan year, the full amount of the employee’s annual election will be deducted pre-tax, lowering an employee’s taxable income and maximizing tax savings.

Use the tax calculator below to see how much you could be saving by participating in a Dependent Care FSA!

Calculate Your Tax Savings

Medical FSA/HSA

$ Medical Costs: co-pays, deductibles, prescriptions, OTC items, etc
$ Vision Costs: Glasses, Contacts, LASIK, etc
$ Dental Costs: Orthodontics, Fillings, Cleaning, x-rays, etc

Dependent Care FSA

$ Dependent Care Costs (up to $5,000 per calendar year)

Other Pre-Tax Benefits

$ Qualified Parking/Transit
$ Outside Insurance Premiums

Enter Your Overall Tax Rate (Federal + State + FICA)

If you don't know use 27.65 (15% + 5% + 7.65%)

Your FSA Savings Estimate*:

*This Calculator is for entertainment/planning purposes only and does not constitute a guarantee of actual savings. This Calculator assumes that premiums for healthcare coverage are taken on a pre-tax basis and does not take into account such variables as mid-year election changes, participant forfeitures, the Dependent Care Tax Credit, or participant gains due to overspent accounts when coverage terminates early. By using this Calculator, the user agrees that 24HourFlex shall not be liable for any failure to achieve the actual savings projected by this Calculator. No animals were harmed in the making of this calculator.