Do you use a Dependent Care Flexible Spending Account?

[5stljayhawks]

Hi DIS Fams

My family enrolls in the DCFSA / Day Care Flexible spending Account and has $5000 a year(the max by law) withdrawn to help offset cost of day care. The no tax(fed or state) part is the benefit.

I would like to hear from both sides - those who enroll in the DCFSA and those who don’t enroll who but still have have kids in day care or summer camp. I would like to hear both ways and why. The second part is how much do you elect to have withdrawn and then how often do you submit claims to get the money back?

Thanks SP

Our family participates in the DCFSA, enrolls the maximum of $5K and we claim 1-2 times a year.

 

[mward73]

I do it - more for me to get a decent chunk of money 2-3 times a year. The pre-tax deal is nice, too. I submit claims 2-3x a year and use the money for whatever we're doing at the time - vacation, new windows, fence, etc. It's nice to save without really having to save. I do the full $5000.

DH did it for a while through his company (I didn't at that time) and he'd file every payday because his view was they shouldn't get to keep his money interest free. All well and good but it was a pain to keep up with and he was always complaining about it. Ours is super easy so I don't mind at all.

 

[rockawaybeachgirl]

Hi DIS Fams

My family enrolls in the DCFSA / Day Care Flexible spending Account and has $5000 a year(the max by law) withdrawn to help offset cost of day care. The no tax(fed or state) part is the benefit.

I would like to hear from both sides - those who enroll in the DCFSA and those who don’t enroll who but still have have kids in day care or summer camp. I would like to hear both ways and why. The second part is how much do you elect to have withdrawn and then how often do you submit claims to get the money back?

Thanks SP

Our family participates in the DCFSA, enrolls the maximum of $5K and we claim 1-2 times a year.

I don't anymore as my husband stays home so we are not longer eligible - but before that I did, and for the maximum amount as her daycare exceeded (by a lot!) the limit.

The way our plan worked, you could submit expenses exceeding what had been deducted, and as each additional contribution was made it would be paid directly out to you. So, for example, I would submit the day care bills for July-November/December, at which point the expense exceeded the limits, and then each pay period as the pre-tax deduction was made, it would be paid right back to me on the same date.

Other than not being able to predict whether you would have child care expenses or not, I don't really see a downside - it's like a little raise for yourself!

 

[AliceIn]

I would like to hear both ways and why. The second part is how much do you elect to have withdrawn and then how often do you submit claims to get the money back?

We do the full $5,000. We typically do 1 or 2 claims per year. When our kids were little, we'd spend $5K in the first two months of the year. I typically did one claim in early November, and a second one in January the following year to get back the last of the payroll deductions. I sort of use it as a Christmas club.

Some folks submit the full amount in March, and then get reimbursed a little at a time after payday. In the beginning when our expenses were really high, I did this, too.

 

[ICF]

When we had kids that had daycare or before/afterschool care expenses we could claim we did.

I'm not sure why you wouldn't do one if you had the expenses and the program was available to you.

 

[#1hoosierfan]

We do the full $5,000 and and I file the claim once a month.

 

[Namsupak]

We do the full $5,000 and I send in the claim a couple times a year. I usually wait until we're at $2,500 and then the next $2,500 so we just get a check every pay week. The pre-tax thing is really nice. I wish they would up the limit because it doesn't take us long to get to $5,000.

 

[jperrot1]

We did it but filling out the paper work is something we had to do every month: we submitted once a month. But, now we opt out of the flexible spending account and have our tax accountant claim it a different way. We don't have to fill out monthly forms and still get a tax deduction. I don't know if the tax deduction is as great as using the flexible account but...... this way it doesn't affect social security. Remember when you use a flexible spending account, it is as if you didn't earn that money according to the government. So, when it comes time to receive social security which is based on how much you earned, you won't receive credit for those amounts that you flexed.

 

[wiigirl]

I do it - more for me to get a decent chunk of money 2-3 times a year. The pre-tax deal is nice, too. I submit claims 2-3x a year and use the money for whatever we're doing at the time - vacation, new windows, fence, etc. It's nice to save without really having to save. I do the full $5000.

DH did it for a while through his company (I didn't at that time) and he'd file every payday because his view was they shouldn't get to keep his money interest free. All well and good but it was a pain to keep up with and he was always complaining about it. Ours is super easy so I don't mind at all.

Same here.

 

[teedisney]

I've been using the benefit for 9 years. Early on I submitted every couple of weeks.during the I think we did quarterly. This year I will probably submit one just before summer to pay for summer camp.

 

[sherry7]

Yes, I use a DCA account, with the full $5,000. I really wish the limit was higher, since I pay more daycare expenses in a year for just one child. But, it's still nice to have it count as non-taxable income.

Last year (first year I did it), I waited until the end of the year to submit, and got the $5,000 all at once. I haven't submitted yet this year, but I think I'm going to soon, and then once or twice again during the year. It's a fairly easy process through the vendor that handles ours. I basically just fill out a short online form, print a fax cover sheet, and fax the receipts in. I can also send them as an attachment, if I have 3 or less.

As an interesting note, I don't think many people have this available through their employers. At our daycare (about 45 kids), the owner/director said that I'm the only one. (She had to modify the way that she typically does receipts for us, and add her ESN number.) Our former daycare said the same thing. So, I'm thinking that not many employers must offer this, at least in my area.

 

[tvguy]

We did it when our kids had eligible expenses. I submitted it monthly because our plan required claims to be filed within 30 days of the expense being incurred.
Only thing we had to be careful with was documenting what child care cost, because the child care was bundled with private school. The plan administrator balked at our first claims because there was only $20 difference between private school tuition with before and after school care, and just before and after school care. $120 a week for both, $100 a week for before and after school care by itself.

 

[ruadisneyfan2]

We did this until we no longer had child care expenses. Now we just do the FSA for medical. With both kids in braces, there's nothing left for rx, copays, etc. This too shall pass...

 

[DonaldnDaisy5]

Can you do both? A flexible spending for child care expenses and a health savings? we wanted to do the flex account this year for before school care and youngest preschool tuition, but my employer switched health care plans and enrolled us all into a hsa...

 

[ruadisneyfan2]

Can you do both? A flexible spending for child care expenses and a health savings? we wanted to do the flex account this year for before school care and youngest preschool tuition, but my employer switched health care plans and enrolled us all into a hsa...

I believe you can. My kids are teens and back when they were in day care, I recall thinking we didn't have enough medical expenses to make it worth the effort of saving receipts, tracking refunds, etc. It was all done manually. Filling out forms & mailing them in. These days, they give us a Visa card for eligible expenses. It couldn't be any easier. I only wish they'd raise the limit.

 

[brightcutie]

I have both a flexible spending medical plan and dependent day care plan. I love having them, because we just budget for daycare, medicine, and co pays each month and when we are reimbursed the following month that money goes to pay off debt.

 

[DonaldnDaisy5]

Hmmm interesting, I was told we can only have one. And since our health plan required it for the deductible we couldn't do the other....I may need to look into this more....

 

[AliceIn]

Can you do both? A flexible spending for child care expenses and a health savings? we wanted to do the flex account this year for before school care and youngest preschool tuition, but my employer switched health care plans and enrolled us all into a hsa...

Yes you can.

 

[Janina47]

We don't currently have a DCFSA, but our friends told us there are many benefits to having one so we're probably signing up next year. Our regular flex spending account has been a great way to save though. You get $5,000 a year for the DCFSA and now $2,500 per person for regular fsa. I found a good place for answers to fsa questions is fsastore.com where they explain flex spending accounts.

 

[ldbillings]

Yes, you can do both a Dependent Care Flex spending plan and a Healthcare flex spending plan, and we do.

We deduct the full $5,000 for dependent care, since we spend way more than that over the course of a year. I submit claims once a month until all of the money is gone.

I recommend both plans - they are a great tax savings.