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Started By
Message
re: Does anyone here take advantage of their employer's Dependent Care FSA benefits?
Posted on 10/7/24 at 9:51 pm to DeathValleyPVC
Posted on 10/7/24 at 9:51 pm to DeathValleyPVC
quote:
Anyone know how to submit a claim for personal babysitter for summer care? Can you show Venmo receipts?
I think it only applies if the baby sitter files taxes on that income. You have to submit their tax id number or SSN to be able to claim it.
We have done DCFS while our kids were in preschool and daycare and it would be our forced savings for the following year.
Only problem is if you can’t foresee changes in cost, because you lose it if you don’t spend it. We didn’t think about it when we signed our kids up for summer camp, and decided to go 3 days a week instead of 5 to save money. When I looked at costs again, we may not use all $5k, so now we are trying to send the kids to “big kids care” any time they are out of school.
1
Posted on 10/7/24 at 11:22 pm to finchmeister08
It would be idiotic NOT to use the DCFSA.
Posted on 10/8/24 at 12:04 am to DeathValleyPVC
Any care has to be so you can work. Summer camps were my primary deduction when they weren't in private. Golf camp was a bit more complicated because he was paid through Venmo, and I didn't have his TIN. I just used the address of the club (the only one he worked at,) and uh, rolled the dice.
A personal babysitter/nanny would make me much more nervous, due to nanny tax issues, etc. If it's one camp here, another one next week, then you have sub $1k transactions to different entities. If you just hire a nanny for the summer, you're going to spend a lot more than that, which can trigger you having to pay SS/FICA taxes as an employer, etc. Especially young, I'd just leave them in pre-school and use a babysitter on odd weeks where the pre-school is closed.
What you have to show depends on who your dependent care savings account servicer is. While this is stretching back a decade, at one company I had one that required no docs, but if I was audited, I'd have to come up with some. A different company wouldn't accept a claim without documentation with a TIN (taxpayer identification number.)
You're likely going to clean out the account every year on preschool alone. When they start school, prepare to start having the fight with the wife, "well, how many summer camps do you think we might send kid to in seven months? Two weeks worth? 12 weeks worth? Bueller?
A personal babysitter/nanny would make me much more nervous, due to nanny tax issues, etc. If it's one camp here, another one next week, then you have sub $1k transactions to different entities. If you just hire a nanny for the summer, you're going to spend a lot more than that, which can trigger you having to pay SS/FICA taxes as an employer, etc. Especially young, I'd just leave them in pre-school and use a babysitter on odd weeks where the pre-school is closed.
What you have to show depends on who your dependent care savings account servicer is. While this is stretching back a decade, at one company I had one that required no docs, but if I was audited, I'd have to come up with some. A different company wouldn't accept a claim without documentation with a TIN (taxpayer identification number.)
You're likely going to clean out the account every year on preschool alone. When they start school, prepare to start having the fight with the wife, "well, how many summer camps do you think we might send kid to in seven months? Two weeks worth? 12 weeks worth? Bueller?
Posted on 10/8/24 at 8:59 am to Teddy Ruxpin
I guess I meant less take home per month. Ours is designed so you can only submit for what you have already paid in. So if you contribute to it monthly rather than lump sun the $5k, you can only submit $417 each monthly.
I guess we should lump sum it. I would get it back in 2-2.5 months I think.
I guess we should lump sum it. I would get it back in 2-2.5 months I think.
Posted on 10/8/24 at 10:15 am to finchmeister08
quote:
One place had a weekly rate of $335 a week.
That's not all that bad actually.
We pay $80/day. Granted it is a small, private, in home daycare with only about 5 kids max, but still...$400 a week is about typical in our area.
Posted on 10/8/24 at 11:21 am to TheWiz
quote:
I guess I meant less take home per month. Ours is designed so you can only submit for what you have already paid in. So if you contribute to it monthly rather than lump sun the $5k, you can only submit $417 each monthly.
I guess we should lump sum it. I would get it back in 2-2.5 months I think
Our platform allows me to submit receipts at any time, and pays out opon deposit of funds. The claim becomes payable once the period the claim is covering ends. For example, daycare is due on the first but the claim isn't payable until the after the last day of the month.
Let's say daycare is expensive, $1,500 a month. I deposit $417 a month.
1st of the month I pay $1,500. I get my receipt and upload it. I don't get paid out yet because I haven't deposited to the DFSA yet.
The month ends and I get paid again, at the same time $417 is reimbursed to me (the first month you actually get paid out twice due to the delay, so $834 will come back to you).
That leaves about $700 unpaid from the initial claim.
You pay month two on the first and you submit the claim. Another month passes. On the next first, the account will deposit $417 and immediately payout the same. You aren't out the money more than maybe two days for paycheck processing.
You are now down to $300 left on your claim and so on. Of course, you'd also submit additional receipts up to $5,000 to keep the money flowing to you.
This post was edited on 10/8/24 at 11:26 am
Posted on 10/8/24 at 11:25 am to finchmeister08
Yes, I take advantage of the dependent care FSA through my employer. We max-out the benefit and there is a payroll deduction on each paycheck for the amount divided by 26 pay periods. I submit my reimbursements frequently instead of waiting to get all the money back at once. I'd highly recommend it, and certainly recommend doing frequent reimbursements instead of waiting to do it all at once.
Posted on 10/8/24 at 12:10 pm to finchmeister08
quote:
so, you guys are paying the full price of daycare out of your own pocket throughout the year while also contributing to the FSA?
I submit receipts as I get them. And since daycare costs well over $5,000 a year, I get reimbursed basically twice a month.
$208.33 is withheld from my paycheck and deposited into the FSA account. And then since I already have a backlog of receipts loaded, the $208.33 then automatically gets deposited into my bank account about a week after the paycheck.
I do not wait until EOY for a lump sum $5,000.
Posted on 10/8/24 at 1:37 pm to tigeraddict
quote:
I did while my sons was in daycare. Now in 1st grade so no use
If he goes to any type of afterschool care, or childcare/day camps in the summer, it can be used on that as well.
Posted on 10/8/24 at 2:02 pm to akimoto
quote:
Only problem is if you can’t foresee changes in cost, because you lose it if you don’t spend it. We didn’t think about it when we signed our kids up for summer camp, and decided to go 3 days a week instead of 5 to save money. When I looked at costs again, we may not use all $5k, so now we are trying to send the kids to “big kids care” any time they are out of school.
Similar thing here. We found a way to save money over the camps, but using a babysitter may actually hurt me in this case.
Posted on 10/8/24 at 3:19 pm to finchmeister08
quote:
can you go into more detail on that? i thought the money you put in can't be rolled over?
You can typically reimburse yourself at any time. I usually take 3 a year, but the last one will be early the next year, since it won't max out until my last check in December.
The part about it not rolling over is you can't use it to pay for any child care in that next year. It has to be paid for the year of. It was mentioned previously, but let's say you think your going to pay $5k total in childcare for the year, but you end up only paying for $4k for whatever reason, that $1k can't be reimbursed. It will be pre-tax, but you won't be able to get the money back.
Posted on 10/8/24 at 3:45 pm to PJinAtl
And break that out per hour based on a 40 hour work week … I mean what price does a person put on the well being of their children?
Posted on 10/8/24 at 10:29 pm to finchmeister08
I can’t afford to float the entire 5k per year like some people here, but I float it monthly, break down 5k over 12 months, and reimburse myself that amount each month.
Posted on 10/8/24 at 11:35 pm to TheBoo
My wife’s company offers it and we max it every year. But now my youngest is in Kindergarten so it’s really only summer camps I can use it for.
Posted on 10/9/24 at 8:08 am to saderade
Are some of you making over $150k-$155k/household and still getting $5k no problem? We just got a dependent care FSA in the last few months through wife's work and we will easily exceed $150k/household income this year so I only elected for her to set aside $3,600, not $5,000.
See the "Maximum annual dependent care FSA contribution limits" at the bottom here:
LINK
See the "Maximum annual dependent care FSA contribution limits" at the bottom here:
LINK
Posted on 10/9/24 at 8:43 am to thunderbird1100
Pretty sure there isn't an income limit. The link you posted is for the university of Michigan. Do you work for them or something?
Posted on 10/9/24 at 9:03 am to Civildawg
I actually just did a generative AI search on google when originally searching about income limits for dependent care fsa and that popped up, guess it might be employer dependent to some degree?
Guess i need to switch ours to $5,000
Guess i need to switch ours to $5,000
This post was edited on 10/9/24 at 9:07 am
Posted on 10/9/24 at 9:10 am to thunderbird1100
There’s no income limit, you and your spouse (if filing jointly) need to both work or be in school to be able to claim it.
I would think University of Michigan would be a reputable source, but that website is the HR page so that makes sense why it’s wrong
I would think University of Michigan would be a reputable source, but that website is the HR page so that makes sense why it’s wrong
Posted on 10/9/24 at 9:46 am to HarveyBanger
quote:quote:
One place had a weekly rate of $335 a week. A WEEK
Ours is $285 a week for one kid. Another kid on the way. F my life
Don't get me wrong, it's a lot but it could be worse. Our rate is between $275 - $290 per week depending on whether or not you do the 10-month or 12-month program; but you have to pay it all upfront in May. It does get a little cheaper as they get older, but those one-time checks are a bit much to cut.
Posted on 10/9/24 at 10:38 am to finchmeister08
Yes we do. I don't have all the details but I know we max it out. I know my wife is able to use the funds for some some different expenses other than daycare. We also use it for our boys Au Pair
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