FSA for daycare

annam829

I am totally clueless as to how this works.  I was just informed the city is now participating in this.  I have read the info, but am still not sure how it works.  I pay $1300+ a month for daycare and I think a FSA max is $197 per pay (every 2 weeks)  Can someone please explain this to me as simple as possible?  Thanks for any info

jessica0602

The hubs just enrolled in this.  I believe it's just cash pulled from your check before taxes are taken out, similar to an HSA.

eaglesfan700

Your deductions are taken pre-tax, like your healthcare and 401(k) deductions. 

So if you make 1,197 a pay period, the $197 is taken out first, so you are only taxed on $1000

ering1115

between you and dh you are eligible for up to $5k annually in benefits (i.e. he can take $5K or you can both take $2.5K).  this money is taken out of the check automatically before taxes (i do $5k annually and it is like $300/check).  there is a 3rd party company that you give your receipts to (we do ours quarterly) and you are then paid out the amount you are owed. 

it doesn't cover my daycare costs but i look at it as more of a savings account. 

your hr department should be able to give you more info on reimbursement schedule and all of that fun stuff. 

Tianacheron

ering1115:

between you and dh you are eligible for up to $5k annually in benefits (i.e. he can take $5K or you can both take $2.5K).  this money is taken out of the check automatically before taxes (i do $5k annually and it is like $300/check).  there is a 3rd party company that you give your receipts to (we do ours quarterly) and you are then paid out the amount you are owed. 

it doesn't cover my daycare costs but i look at it as more of a savings account. 

your hr department should be able to give you more info on reimbursement schedule and all of that fun stuff. 

ditto to all of this, it has to be a licensed provider or someone that claims the daycare you pay as income on their tax return. also the portion which you are reimbursed you can not claim as a daycare expense on your taxes

eSynergy

In order to get the full $5000/year, I divide 5000 by 26 (the # of pay periods) and that = the amount to take out of each paycheck. 

So...5000/26=$192.30

It really should be more than $5000!!! But, at least you save a little by doing this.

stilldreaming

lllllllllllllllol! 

$197 per 2 weeks. Thanks for the stale bread and water gov't!

lol.