Dependent Care FSA FAQs
Pro Tips for Using Your Dependent Care Benefit
Your Dependent Care FSA saves you money on eligible dependent care expenses. Understanding these scenarios will help you get the most value out of your benefits.
Changes and Contributions
When can I change the amount deducted from my paycheck for my Dependent Care FSA?
You can change your Dependent Care FSA contributions any time you experience a permitted election change event. Some events only allow a change if the event causes a change to plan eligibility. These events include a change to your marital status, the number or eligibility of your dependents, your employment status, or your spouse’s employment status.
Dependent Care FSAs are fairly flexible if your dependent care circumstances change and you are allowed to update your election during the year if your care provider changes or they significantly decrease or increase their rates during the plan year. In order for this type of event to permit a change, the provider cannot be your relative.
I’m expecting a baby this year. Should I try to estimate my child care expenses and enroll during open enrollment?
We recommend waiting to enroll in a Dependent Care FSA until after your child is born or adopted and registered with the care provider. This means you need to make sure to sign up within 30 days of the dependent care event so you don’t miss your opportunity!
Life circumstances are not always predictable and your need for dependent care plans may change unexpectedly if your child has unforeseen needs or a family member suddenly volunteers to help out. Once you enroll in the Dependent Care FSA, you are only able to change your election if you experience a new set of circumstances that qualify as a permitted election change event. If you enroll in anticipation of dependent care expenses or even the anticipated addition of a new family member, there is no “change” later in the year to act on.
Claims and Available Funds
How do I use my Dependent Care FSA funds to pay for dependent care expenses?
Pay your provider with your preferred payment method and save your receipts or documentation. You can only be reimbursed for care that has already been received, so wait until the period of care you’ve paid for has passed. Then log into your online account and submit a claim for reimbursement. You will be reimbursed for care received as of that date and documented on the receipts you submitted, up to the dollar amount you have available in your Dependent Care FSA. Make sure to sign up for direct deposit to get your funds fast—they’re electronically deposited in your savings or checking account.
I submitted a claim from my Dependent Care FSA but have not received my reimbursement. Why haven’t I been reimbursed?
There are two reasons why your reimbursement might be delayed–your dates of service have not yet passed or you have not yet contributed enough to your Dependent Care FSA to receive full reimbursement for your claim.
Dependent Care FSA claims are not reimbursed until after the last day of service listed. For example, if you submit a claim that includes an 8 week period of care, your reimbursement will not be sent until the last day of the eighth week. To be reimbursed faster, file each week as a separate claim and you will receive reimbursement as each week passes.
You can only receive reimbursement for Dependent Care FSA claims up to the amount that has already been deducted from your paycheck. If your approved claim is for a dollar amount that is more than the amount actually withdrawn from your payroll to date, reimbursement is sent to you periodically as more funds are deducted from your pay through the year.
How long do I have to wait before submitting my next claim for reimbursement?
You may submit claims as frequently as you would like—weekly, biweekly, or monthly. Remember that your expense is only reimbursed after the service has been provided and all dates of service have concluded. Shorter claim periods result in more frequent reimbursement payments.
I am contributing $2,000 to my Dependent Care FSA this year. May I use the full $2,000 prior to having the funds deducted from my paycheck?
You can only be reimbursed up to the amount of funds you have already contributed to your Dependent Care FSA through payroll deductions. This is different from a Health Care FSA, where you have access to your entire election right away at the start of the plan year.
How long do I have to submit claims for my Dependent Care FSA?
Each Dependent Care FSA has a specific claims submission deadline, after a runout period, which is a timeframe after your benefit plan year ends when you may continue to submit claims for your dependent care expenses that took place during the plan year. Log in to your online account and refer to My Company Plan for details on your runout period.
I didn’t end up using all the funds in my Dependent Care FSA. Does any of it roll over to the next year?
No. IRS regulations do not allow Dependent Care FSA funds to carry forward from one year to the next.
Eligible Expenses
My childcare provider is my child’s grandmother. Can I get reimbursed from my Dependent Care FSA if I pay her for babysitting?
Yes. As long as the relative providing care is not claimed by you or your spouse as a tax dependent, you can be reimbursed for amounts you pay them for care of your dependent. Use caution in these circumstances because to be an eligible expense, the person you are paying for babysitting must claim the amount that you are reimbursed from your Dependent Care FSA as taxable income.
My child’s babysitter is my 17-year-old neighbor. Can I get reimbursed from my Dependent Care FSA if I pay him for the babysitting?
Yes. Your Dependent Care FSA can reimburse you for expenses paid to a babysitter under the age of 19 as long as the babysitter is not the participant’s child, stepchild, foster child, or tax dependent of the participant or spouse. However, the babysitter must provide their Social Security Number, and must claim their earnings as income.
My child needs tutoring, so instead of paying for childcare during certain hours, I am now paying for him to be at the tutor. Can I use my Dependent Care FSA funds to pay tutoring expenses?
No. You may not use Dependent Care FSA funds for tutoring because it is considered an educational expense instead of a dependent care expense.
I am sending my child to an Arts & Crafts Day Camp. Can I pay with my Dependent Care FSA?
Yes. Day camp expenses are eligible for reimbursement from Dependent Care FSAs.
I am sending my daughter to overnight summer camp for 5 weeks. Can I pay with my Dependent Care FSA?
No. Overnight camp expenses are not reimbursable by a Dependent Care FSA—even if the camp separates out daytime activities.
My wife resigned from her position at her job and isn’t looking for another job right now. My two sons really like daycare so we plan to keep them enrolled. Can I continue paying for their daycare expenses with my Dependent Care FSA funds?
No. For a dependent care expense to be eligible for reimbursement from a Dependent Care FSA, the care must be to enable you and your spouse to work, actively look for work, or attend school full-time. Actively looking for work means researching and applying for jobs, attending interviews, or related activities.
My son is 13 years old and I would like to continue the positive relationship he has with his longtime after-school caretaker. Can I continue to pay for this care with my Dependent Care FSA?
No. IRS regulations state that an expense that is eligible for payment from a Dependent Care FSA must be for a dependent child under age 13, unless he is physically or mentally unable to care for himself.
My elderly father is now living with me because he cannot take care of himself. If I take him to an adult day care facility, is it an eligible Dependent Care FSA expense?
Yes. Dependent Care FSA funds may be used for adult day care, provided the adult meets the definition of a “qualifying individual.” This is someone who is both mentally or physically incapable of caring for themselves, and has the same principal place of abode as you for more than half of the year. In addition, to be eligible for care outside of the home, the qualified individual must spend at least eight hours a day in your home.
My father lives with me and cannot care for himself. I have hired a caretaker to visit him in our home for a few hours while I am at work. Is this an eligible Dependent Care FSA expense?
Yes. If you (and your spouse if married) are employed, you can be reimbursed from your Dependent Care FSA for adult day care in your home as long as your father is a qualified individual and the caretaker is providing custodial care for your father.
My father lives with me because he cannot take care of himself. He needs an in-home nurse for his basic care. Can I pay for this nurse with my Dependent Care FSA?
No. A nurse is considered a health care expense instead of a dependent care expense. Health care expenses cannot be reimbursed from a Dependent Care FSA.