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Learning, Sharing, and Teaching => Ask a Mustachian => Topic started by: jamesbond007 on November 06, 2017, 11:16:51 AM

Title: Can I claim "pre-school + After school" fees from dependent care FSA?
Post by: jamesbond007 on November 06, 2017, 11:16:51 AM
My wife and I work full time. We send our 3YO to a pre-school from 8:30 - 1130 AM every day. Then, from 11:30 AM - 6 PM as after school care at the same pre-school location. So basically DD stays at the same location all day. My wife works full time at the same pre-school. The question is, can I use the $625 I pay towards my DD's "pre-school" fees which includes after school care as dependent care?  We file jointly and I could use the $5000 pre-tax money to pay for part of DD's fees.



Title: Re: Can I claim "pre-school + After school" fees from dependent care FSA?
Post by: jamesbond007 on November 06, 2017, 12:50:06 PM
bump
Title: Re: Can I claim "pre-school + After school" fees from dependent care FSA?
Post by: Illgetthere on November 06, 2017, 01:08:23 PM
According to the IRS, you can use it for any daytime care except school tuition starting in K. Knowing that, I'd say yes
Title: Re: Can I claim "pre-school + After school" fees from dependent care FSA?
Post by: jamesbond007 on November 06, 2017, 02:01:04 PM
According to the IRS, you can use it for any daytime care except school tuition starting in K. Knowing that, I'd say yes

Great. Thanks.
Title: Re: Can I claim "pre-school + After school" fees from dependent care FSA?
Post by: charis on November 06, 2017, 02:29:36 PM
I think in order for the preschool to count, the primary focus of it needs to be daycare, not an educational program.  At least that's how I read the IRS instructions.
Title: Re: Can I claim "pre-school + After school" fees from dependent care FSA?
Post by: jamesbond007 on November 06, 2017, 02:51:52 PM
I think in order for the preschool to count, the primary focus of it needs to be daycare, not an educational program.  At least that's how I read the IRS instructions.
How does once verify this? I am trying to be fraudulent but I'm just curious. My DD's pre-school is from 830-1130. We could bring her home immediately after. But since we work full time, we leave her at the same location as "after school" along with other after school kids. How do I itemize pre-school and after school expenses, in this case, so I could claim only after school expenses?
Title: Re: Can I claim "pre-school + After school" fees from dependent care FSA?
Post by: KCM5 on November 06, 2017, 02:54:28 PM
I've used flex spending to pay for preschool fees - without her being at that preschool I wouldn't be able to work, which is what I understand the IRS stipulations to be. Any tax pros want to step in?
Title: Re: Can I claim "pre-school + After school" fees from dependent care FSA?
Post by: Illgetthere on November 06, 2017, 02:54:34 PM
From IRS pub 503

Education. Expenses for a child in nursery school, pre-
school, or similar programs for children below the level of
kindergarten are expenses for care.
Expenses to attend kindergarten or a higher grade
aren't expenses for care. Don't use these expenses to fig-
ure your credit.
However, expenses for before- or after-school care of a
child in kindergarten or a higher grade may be expenses
for care.
Summer school and tutoring programs aren't for care.
Example 1. You take your 3-year-old child to a nurs-
ery school that provides lunch and a few educational ac-
tivities as part of its preschool childcare service. The lunch
and educational activities are incidental to the childcare,
and their cost can't be separated from the cost of care.
You can count the total cost when you figure the credit.
Example 2. You place your 10-year-old child in a
boarding school so you can work full time. Only the part of
the boarding school expense that is for the care of your
child is a work-related expense. You can count that part of
the expense in figuring your credit if it can be separated
from the cost of education. You can't count any part of the
amount you pay the school for your child's education
Title: Re: Can I claim "pre-school + After school" fees from dependent care FSA?
Post by: LostGirl on November 06, 2017, 02:58:30 PM
Preschool counts. You don't need to read into it beyond that. It's not tutoring, its preschool.
Title: Re: Can I claim "pre-school + After school" fees from dependent care FSA?
Post by: jamesbond007 on November 06, 2017, 02:59:07 PM
From IRS pub 503

Education. Expenses for a child in nursery school, pre-
school, or similar programs for children below the level of
kindergarten are expenses for care.
Expenses to attend kindergarten or a higher grade
aren't expenses for care. Don't use these expenses to fig-
ure your credit.
However, expenses for before- or after-school care of a
child in kindergarten or a higher grade may be expenses
for care.
Summer school and tutoring programs aren't for care.
Example 1. You take your 3-year-old child to a nurs-
ery school that provides lunch and a few educational ac-
tivities as part of its preschool childcare service. The lunch
and educational activities are incidental to the childcare,
and their cost can't be separated from the cost of care.
You can count the total cost when you figure the credit.
Example 2. You place your 10-year-old child in a
boarding school so you can work full time. Only the part of
the boarding school expense that is for the care of your
child is a work-related expense. You can count that part of
the expense in figuring your credit if it can be separated
from the cost of education. You can't count any part of the
amount you pay the school for your child's education

THIS. Thanks. You could've just responded with RTFM so thanks for not doing that. I am having a huge brain fart today and forgot to google.
Title: Re: Can I claim "pre-school + After school" fees from dependent care FSA?
Post by: mm1970 on November 06, 2017, 03:20:05 PM
In short: yes, up till age 13.

Includes summer camp, but not sleepover summer camp.
Title: Re: Can I claim "pre-school + After school" fees from dependent care FSA?
Post by: ZMonet on November 09, 2017, 10:50:04 AM
Take the FSA deduction while you can as this is on the chopping block for next year.  I had heard that the House put it back in, but who knows what the final tax plan will be.

http://www.sacbee.com/news/politics-government/article182260906.html

"Working parents would no longer be able to use pre-tax money to help pay for child care under a plan released by Republicans in the U.S. House of Representatives on Thursday."
Title: Re: Can I claim "pre-school + After school" fees from dependent care FSA?
Post by: I'm a red panda on November 09, 2017, 11:41:56 AM
Take the FSA deduction while you can as this is on the chopping block for next year.  I had heard that the House put it back in, but who knows what the final tax plan will be.

http://www.sacbee.com/news/politics-government/article182260906.html

"Working parents would no longer be able to use pre-tax money to help pay for child care under a plan released by Republicans in the U.S. House of Representatives on Thursday."

Oh come on!
They are taking away such minimal things.  This $5000 pre-tax barely makes a dent into childcare fees (and I live in Iowa not NYC).  It's like taking away the $250 deduction for teachers- most of whom spend WAY more than that yearly.
Title: Re: Can I claim "pre-school + After school" fees from dependent care FSA?
Post by: jamesbond007 on November 09, 2017, 11:56:39 AM
Take the FSA deduction while you can as this is on the chopping block for next year.  I had heard that the House put it back in, but who knows what the final tax plan will be.

http://www.sacbee.com/news/politics-government/article182260906.html

"Working parents would no longer be able to use pre-tax money to help pay for child care under a plan released by Republicans in the U.S. House of Representatives on Thursday."

Oh come on!
They are taking away such minimal things.  This $5000 pre-tax barely makes a dent into childcare fees (and I live in Iowa not NYC).  It's like taking away the $250 deduction for teachers- most of whom spend WAY more than that yearly.

GOP logic. Go figure. Hitting the pocket books of the middle and low income class and transferring the wealth over to the rich. This country is beyond stupidity at this point.
Title: Re: Can I claim "pre-school + After school" fees from dependent care FSA?
Post by: NoStacheOhio on November 09, 2017, 01:12:11 PM
Take the FSA deduction while you can as this is on the chopping block for next year.  I had heard that the House put it back in, but who knows what the final tax plan will be.

http://www.sacbee.com/news/politics-government/article182260906.html

"Working parents would no longer be able to use pre-tax money to help pay for child care under a plan released by Republicans in the U.S. House of Representatives on Thursday."

How does that work when you have to elect flex spending during open enrollment? Would it be effective starting 2019?

What happened to increasing child care deduction allowances? Wasn't that Trump's (Ivanka's?) big thing six months ago?
Title: Re: Can I claim "pre-school + After school" fees from dependent care FSA?
Post by: I'm a red panda on November 09, 2017, 01:15:30 PM
Take the FSA deduction while you can as this is on the chopping block for next year.  I had heard that the House put it back in, but who knows what the final tax plan will be.

http://www.sacbee.com/news/politics-government/article182260906.html

"Working parents would no longer be able to use pre-tax money to help pay for child care under a plan released by Republicans in the U.S. House of Representatives on Thursday."

How does that work when you have to elect flex spending during open enrollment? Would it be effective starting 2019?

What happened to increasing child care deduction allowances? Wasn't that Trump's (Ivanka's?) big thing six months ago?

Aren't they increasing the credit? By like $600 or something?

You know, an amount that totally makes a dent in a $15,000 daycare bill.
Title: Re: Can I claim "pre-school + After school" fees from dependent care FSA?
Post by: NoStacheOhio on November 09, 2017, 01:28:59 PM
Take the FSA deduction while you can as this is on the chopping block for next year.  I had heard that the House put it back in, but who knows what the final tax plan will be.

http://www.sacbee.com/news/politics-government/article182260906.html

"Working parents would no longer be able to use pre-tax money to help pay for child care under a plan released by Republicans in the U.S. House of Representatives on Thursday."

How does that work when you have to elect flex spending during open enrollment? Would it be effective starting 2019?

What happened to increasing child care deduction allowances? Wasn't that Trump's (Ivanka's?) big thing six months ago?

Aren't they increasing the credit? By like $600 or something?

You know, an amount that totally makes a dent in a $15,000 daycare bill.

Are they eliminating the FSA and making people take the year-end write-off?
Title: Re: Can I claim "pre-school + After school" fees from dependent care FSA?
Post by: Illgetthere on November 09, 2017, 01:38:44 PM
Take the FSA deduction while you can as this is on the chopping block for next year.  I had heard that the House put it back in, but who knows what the final tax plan will be.

http://www.sacbee.com/news/politics-government/article182260906.html

"Working parents would no longer be able to use pre-tax money to help pay for child care under a plan released by Republicans in the U.S. House of Representatives on Thursday."

How does that work when you have to elect flex spending during open enrollment? Would it be effective starting 2019?

What happened to increasing child care deduction allowances? Wasn't that Trump's (Ivanka's?) big thing six months ago?

Aren't they increasing the credit? By like $600 or something?

You know, an amount that totally makes a dent in a $15,000 daycare bill.

Are they eliminating the FSA and making people take the year-end write-off?

That is very possible. It's something that they can spin as not making much of a difference, except the FSA is exempt from FICA where as the deduction is not.  In addition, the FSA lowers W2 income used to calculate the EITC.
Title: Re: Can I claim "pre-school + After school" fees from dependent care FSA?
Post by: NoStacheOhio on November 10, 2017, 06:00:31 AM
That is very possible. It's something that they can spin as not making much of a difference, except the FSA is exempt from FICA where as the deduction is not.  In addition, the FSA lowers W2 income used to calculate the EITC.

So it won't make or break my tax life, but it could make a big difference for people with less money. Fantastic. *eyeroll*