Frequently Asked Questions
The “custodial parent” is the parent with whom the child lived for the greater number of nights during the past calendar year. If the child was with each parent for an equal number of nights, the custodial parent is the parent with the higher adjusted gross income. The noncustodial parent cannot treat the child as a qualifying person even if that parent is entitled to claim the child as a dependent under the special rules for a child of divorced or separated parents.
Check with your legal or tax advisor to see if special rules apply to you that would enable your child to be claimed by the noncustodial parent or by both parents.
Here’s an example. Your employer’s plan year runs from January 1, 2017 through December 31, 2017, and you will be covered for the entire plan year. Your daughter is a qualifying child until her 13th birthday on August 1, 2017, and is not a qualifying child or relative as of August 1, 2017. The dependent care services provided for your daughter between January 1, 2017 and July 31st, 2017 are eligible to be paid from your account. The dependent care services provided for your daughter on August 1, 2017 and later are not eligible because she is not a qualifying child or relative at the time the services are provided.
The same example applies for a qualifying relative who becomes capable of self-care on August 1, 2017. If your employer’s plan allows all federally-recognized changes, both events (your daughter’s 13th birthday and a person ceasing to be a dependent) are qualified change events that will allow you to decrease your election or cancel your enrollment in your WageWorks Dependent Care FSA.
Families often need help with child and elder care. A Dependent Care Flexible Spending Account (FSA) lets you save on dependent care expenses using pre-tax dollars. You can spend your dependent care savings account funds on a wide range of care for eligible members of your family. Some of the expenses covered include senior care, child care, babysitting, before/after-school programs and sick child care.
Dependent Care expenses must be incurred to enable you (and your spouse if married) to work or look for work. Work may include actively looking for work but does not include unpaid volunteer work, or volunteer work for a nominal salary. Your spouse is considered to have worked if he or she is a full-time student for at least five calendar months during the tax year, or if he or she is physically or mentally incapable of self-care.
Expenses you pay for Dependent Care while you are off work due to illness are not eligible for reimbursement.
WageWorks makes it as easy as possible to use your Dependent Care FSA. You can pay for eligible expenses in two ways:
If your claim amount is more than what you have in your Dependent Care account, WageWorks will reimburse you up to the amount that is in your account and hold the rest of your claim until your account is funded. At that time WageWorks will reimburse you for the rest of our claim.
No, you will only have access to Dependent Care funds that have been deducted from your pay check each pay period.
Your election may not exceed the maximum amount specified in Section 129 of the Internal Revenue Code. Currently, the maximum annual amount is $5,000 per year ($2,500 if you are married and file separate returns). Your maximum allocation may not exceed the earned income limitation. If you are single, the earned income limitation is your salary (excluding your contributions to the plan). If you are married, the earned income limitation is the lesser of your salary (excluding your contributions to the plan) or your spouse's salary.
If you are married and file a joint tax return, the maximum amount you may exclude is $5,000. In other words, you and your spouse may not each claim $5,000. The maximum amount available if you are married but filing separate returns is $2,500. Please note you may not "double-dip" expenses (e.g., expenses reimbursed under your Dependent Care FSA may not be reimbursed under your spouse's Dependent Care FSA and vice versa).
A qualifying individual is any of the following:
Learn more about qualifying dependents here
No. Fees associated with kindergarten as well as tuition for children in first grade and above are not eligible for reimbursement under a Dependent Care FSA. Expenses related to before and after school care or nursery school expenses are eligible if the care is primarily custodial in nature.
For a list of eligible Dependent Care expenses, please click here.
Your election is irrevocable for the plan year unless you have a change in status or other qualified event as defined in the IRS Regulations and your employer's plan permits such qualified changes.
Qualified changes in status include:
Your requested change must be consistent with a qualifying event. If you experience a change in status or other qualified event, please contact your HR representative to obtain the appropriate paperwork for completion.
All money contributed to a Dependent Care FSA must be used to reimburse qualified expenses incurred during that plan year. Money not used to reimburse eligible expenses is forfeited.
The unused portion of your Dependent Care FSA may not be paid to you in cash or other benefits, including transferring money between FSAs. To reduce the risk of forfeiture, it is critical for you to be conservative when choosing your annual election amount. Our online savings calculator can help you estimate your annual expenses.
You may not claim any other tax benefit for the tax-free amounts received by you under the Dependent Care FSA, although the balance of your eligible employment-related expenses may be eligible for the Dependent Care credit. Please consult your tax advisor to determine whether the tax credit may be more favorable to you than participating in the Dependent Care FSA.
You can pay many of your Dependent Care expenses directly from your FSA account, with no need to fill out paper forms or send in receipts. It's quick, easy, secure, and available online at any time.
To pay a provider:
If you do need to submit a receipt for reimbursement you have several options: