Author Topic: Dependent Care Flex Accounts question  (Read 253 times)

newgirl

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Dependent Care Flex Accounts question
« on: January 30, 2018, 09:37:52 PM »
Our family situation - unmarried, one kid. I claim HOH status and claim the kid on federal/state taxes. Partner files as single. I also cover her for health insurance, and contribute the $5k max to my dependent care flex account for daycare costs.

If we had another kid and remained unmarried, would my partner be able to open a dependent care flex account and fund it to the $5k max for the second kid? Is he required to claim #2 as a dependent on his taxes and/or enroll them as a dependent in his health plan in order to do that? I know that if we were married we'd be limited to the $5000 combined regardless of the number of kids.

Need2Save

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Re: Dependent Care Flex Accounts question
« Reply #1 on: February 03, 2018, 03:51:45 AM »
newgirl - contributing to and benefiting from a dependent day care fsa is seperate entirely from health coverage.  Don't mix up the health plan enrollment with the DCFSA-eligibility. These are unrelated decisions/statuses.

The answer is yes - in order to contribute to a dcfsa through one's employer and claim qualified dependent care expenses for kid #2, the parent must claim that dependent for tax purposes and the expenses must also be paid to a qualified provider with a federal id number so that both parents may work (if married) or go to school full-time.

Dependent defined. A dependent is a person, other than you or your spouse, for whom you can claim an exemption. To be your dependent, a person must be your qualifying child (or your qualifying relative).
Qualifying child. To be your qualifying child, a child must live with you for more than half the year and meet other requirements.

I assume what you really are asking, is if we continue to be unmarried, can we essentially save $10k through 2 seperate DCFSAs since we have 2 kids and each of us would claim one of them and open a seperate DC FSA for that one child?  Be sure your accounting for the DC expenses (if you are using the same child care provider) remain seperate for each child/parent combination.

With health care eligibility, you need to make a seperate decision based on the rules of each of your employers whether both parents need to put one child on their health plan or if one of you can cover both children even if the other parent claims them for tax purposes. (This happens all the time with divorced parents.) Check with your hr department about dependent rules if you are unsure where to find the answers.