Dependent Care Reimbursement Accounts

Eligible expenses for children and disabled spouses.


How does a Dependent Care Reimbursement Account work?

A Dependent Care Reimbursement Account can be used to reimburse for eligible daycare expenses for children 12-and-under or for adult daycare expenses for a disabled spouse or IRS tax dependent. The maximum annual deduction is $5000 (or $2500 if married and filing separately).

Understanding your account
The primary purpose of dependent care expenses must be for "custodial care.” You and your spouse must be gainfully employed (full- or part-time), looking for work, or going to school full-time. Just because an expense is incurred during working hours does not necessarily make it an eligible dependent care expense.

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How to enroll in your Flexible Spending Account

It’s easy, just follow the simple steps below. Please note that your employer will need to be contracted with BenefitHelp Solutions for you to use this benefit.

1. To enroll in the Flexible Spending Account(s) (FSA), please contact your Human Resources (HR) or Employee Benefit department to obtain instructions on enrollment.

2. Determine how much you expect to spend during the plan year on childcare and medical expenses not covered by insurance by using the enrollment worksheet. You may also want to review the listing of eligible & ineligible expenses to verify that expenses you are considering for reimbursement are eligible.

a. The healthcare maximum is determined by your employer
b. The Dependent Care tax year maximum is mandated by the IRS at $5,000 per family ($2,500 if married filing separately).

3. If your employer uses forms, complete the enrollment form you obtained from HR. Sign, date and return your enrollment form to your employer. Do not send to BenefitHelp Solutions.

4. Your employer will automatically deduct the amount requested from your paycheck and send it to BenefitHelp Solutions to be deposited in your FSA account(s).

 

Rules and Guidelines

A few important rules to consider before making your annual election:

  • You cannot change or revoke your healthcare or dependent care annual election unless you experience a qualified life event.
  • Use it or lose it. All funds deducted from your paycheck must be used during the plan year or funds will be forfeited. It is very important to only deduct what you normally expect to pay for out-of-pocket expenses. If your employer offers an FSA carryover, you may be able to roll up to $500.00 into the next plan year.
  • Participation in the Flexible Spending Accounts may slightly reduce your Social Security Benefits.
  • Funds cannot be moved from your healthcare to your dependent care account or vice versa.
  • Only expenses incurred while you are an active participant in the Flexible Spending Accounts are eligible for reimbursement. Expenses incurred prior to your effective date or incurred after termination in the plan are not eligible for reimbursement.

Resources

Need to make changes to your account, determine eligibility or make payments? Check our Member Resources page for additional forms and helpful information.

Still didn’t find what you’re looking for? See what other members are asking about below.

Yes, you must complete the Reimbursement Request Form and attach a receipt of payment indicating the dates of service. (Please see Instructions and Tips for Filing Claim Forms)

If you have set aside dollars through salary reduction, and you do not use those dollars by the end of the plan year, you will lose those dollars. The IRS requires that all funds that have been deducted from your paychecks and placed in the Dependent Care Account must be used during the plan year. It is important to deduct from your salary only the amount that you are sure you will incur as expenses during the plan year. Therefore, it is important to deduct from your salary only the amount that you are sure you will incur as expenses during the plan year.

Changes to the amounts deducted from your salary and deposited into your Dependent Care Account can be made if any of the following qualifying events occur:

  • A change in the cost of dependent care.
  • Employment status
    • Any employment status change for the employee, spouse or dependent
    • Termination or commencement of employment, strike or lockout
    • Return from unpaid leave of absence
    • Change in worksite
  • Dependent eligibility
    • A change in dependent eligibility that causes the dependent to satisfy or cease to satisfy requirement due to: age, marriage, or any similar circumstances
  • A change in family status caused by:
    • Change in number of dependents
    • Change in legal marital status
    • An unpaid leave of absence by you or your spouse

In order to change your healthcare or dependent care election, you must first experience an IRS Qualified Life Event. Qualified Life Events include certain changes in family or work status. Please contact your employer to determine if you have experienced a Qualified Life Event.

Examples of Qualified Life Event Changes:

  • Marriage
  • Divorce
  • Birth or adoption of child
  • Death
  • Change in employment status for you, your spouse or tax dependent
  • Change in dependent care provider
  • Increase or decrease in dependent care provider charges

NOTE: Your election change must be consistent with the Qualified Event.

Please refer to your Summary Plan Description for more details.

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