Most Popular Questions
Yes, but any combination of DCFSA contributions and child care subsidies cannot exceed $5,000 for the year.
Example 1: Marlene is a federal employee who has one child, age 3. She receives a $3,000 child care subsidy from her agency. She also elects a $2,000 DCFSA through her agency.
$3,000 + $2,000 = $5,000
Marlene is OK. She did not exceed the $5,000 limit.
Example 2: Mary is a federal employee, married to Rick who works for ABC Company. They have two children, ages 4 and 8. Mary receives an annual subsidy of $1,500 and has a $3,000 DCFSA through her agency. Rick receives an annual subsidy of $1,000 from his employer.
$1,500 + $3,000 + $1,000 = $5,500 - exceeding the $5,000 limit by $500
Mary and Rick must reconcile any additional taxes owed on the $500 that exceeded the limit, when they file their annual tax return