Flexible Spending - Dependent Care Spending Account
All employees who have sufficient earnings to have the necessary deductions made are eligible to participate in the Dependent Care Spending Account immediately upon hire or during Open Enrollment. There is no waiting period to participate in the Dependent Care Spending Account.
Use it or Lose it
Any money you set aside in the dependent care spending account and do not use between July 1, 2011 and September 15, 2012, you lose. Last date a claim may be filed for the previous plan year is December 31.
How It Works -
You may contribute from $500 to $5,000* to the Dependent Care Flexible Spending Account to reimburse yourself from tax-free savings for dependent care expenses. In order to participate, parent(s) must either be employed or enrolled in school. Additionally, you may also use the account if your spouse is disabled or a full-time student for at least five months during the year.
*In some circumstances, your maximum annual contribution may be lower than $5,000.
If you are married and your spouse contributes to a similar account, your combined contributions may not exceed $5,000 per year.
If you are married but file separate tax returns, your annual contribution is limited to $2,500.
Your contributions cannot exceed the amount of your income or your spouse’s income, whichever is lower.
Tuition for kindergarten is not an eligible expense.
Dependent Care Spending Accounts
Can only be used to reimburse expenses for the care of eligible dependents. Eligible dependents include children under age 13 whom you claim as dependents on your federal tax return
Any other dependents who are mentally or physically disabled and normally spend at least eight hours in your home each day.
Eligible Expenses for reimbursement through the Dependent Care Spending Account include:
Services provided by babysitters or care givers, including your relatives whom you do not claim as exemptions on your federal tax return (your children must be age 19 or over to be considered a care giver)
Expenses for a housekeeper whose services include care of an eligible dependent
Services provided by a licensed elder care center, child care center, daycare or preschool
Social Security and other taxes you pay a care giver