Dependent Care FAQs

1. If I have someone come into my home to take care of my children instead of using a day care facility, do these expenses qualify for a dependent care FSA?
2. When both spouses have dependent care FSAs, can they split a claim between the two accounts?
3. I am a divorced parent. May I establish a dependent care FSA for child care expenses even if my ex-spouse has already done so?
4. Can I use the dependent care FSA for elder care?
5. If a dependent care FSA participant has a dependent elderly parent, he or she can be reimbursed for elder care expenses as long as the parent is in the home at least 8 hours per day. What if the elderly parent remains in their own home but is still a dependent of the adult child?

1. If I have someone come into my home to take care of my children instead of using a day care facility, do these expenses qualify for a dependent care FSA?
Yes. You can include wages paid to a baby-sitter or companion in or outside your home if the services are necessary in order for you (or, if you are married, you and your spouse) to work. Expenses will also qualify for a dependent care FSA if you work and your spouse is a full-time student. You must make payments for care to someone you or your spouse cannot claim as a dependent. You must identify the care provider on your tax return.

2. When both spouses have dependent care FSAs, can they split a claim between the two accounts?
Yes, though it would be better if one participant submitted the entire claim, after which the two spouses could settle up between themselves. However, if both spouses want to submit the claim, each could submit for half and receive that reimbursement.

3. I am a divorced parent. May I establish a dependent care FSA for child care expenses even if my ex-spouse has already done so?
There are special rules for children of divorced parents. With a health care FSA, both can consider the children to be dependents. With a dependent care FSA, only the custodial parent can participate in a dependent care FSA and claim the dependent care expenses. This is true even if the other parent takes the tax deduction. With joint custody, only one parent can participate in the dependent care FSA. The actual time that the child spends with each parent determines which parent can participate.

4. Can I use the dependent care FSA for elder care?
Yes. You can use the dependent care FSA for day care expenses so that you (or if you are married, you and your spouse) can work if:

A.) You are responsible for at least 50 percent of the support of an elderly parent or any person living with you who is physically or mentally incapable of self-care; and this person is your legal dependent; or

B.) The elder care is needed because you work and your spouse is a full-time student.

5. If a dependent care FSA participant has a dependent elderly parent, he or she can be reimbursed for elder care expenses as long as the parent is in the home at least 8 hours per day. What if the elderly parent remains in their own home but is still a dependent of the adult child?
Yes, a dependent care FSA participant can be reimbursed for elder care expenses even if the elderly parent remains in their own home. The elderly parent, must make less than $3,200 (this amount will be adjusted each year), and the adult child must provide more than half of the parent’s support. The parent must not be a qualified dependent of another taxpayer.