Dependent Care FSA (DCFSA)
An employer-sponsored account for paying childcare and dependent care expenses with pre-tax dollars.
What is Dependent Care FSA (DCFSA)?
A Dependent Care Flexible Spending Account (DCFSA) lets you pay for eligible dependent care expenses with pre-tax dollars. This is a separate account from a healthcare FSA and is specifically for care that allows you (and your spouse, if married) to work.
Eligible expenses include daycare, preschool, before and after school programs, summer day camps, and care for elderly or disabled dependents who live with you. The care must be for a child under 13 or a dependent of any age who is physically or mentally incapable of self-care.
The annual contribution limit is $5,000 for married couples filing jointly or single parents ($2,500 if married filing separately). Like healthcare FSAs, DCFSAs are use-it-or-lose-it, so estimate your expenses carefully.
Frequently Asked Questions
Can I use DCFSA for overnight camp?
No. Overnight camps don't qualify because the expense isn't primarily for care while you work. Day camps do qualify.
What's the DCFSA limit?
The limit is $5,000 per household for married couples filing jointly or single parents. Married filing separately is $2,500 each.
Is DCFSA different from healthcare FSA?
Yes. They're completely separate accounts with different contribution limits and eligible expenses. You can have both.
Related Terms
Flexible Spending Account (FSA)
An employer-sponsored account that lets you pay for eligible healthcare expenses with pre-tax dollars, typically with a use-it-or-lose-it rule.
Pre-Tax
Money contributed to your HSA before income taxes are calculated, reducing your taxable income.
Use It or Lose It
The FSA rule that forfeits unused funds at the end of the plan year, unlike HSAs which roll over.
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