Dependent care Fsa

Non-investing personal finance issues including insurance, credit, real estate, taxes, employment and legal issues such as trusts and wills.
Post Reply
Topic Author
charlestown1978
Posts: 64
Joined: Sun Mar 20, 2011 10:47 pm

Dependent care Fsa

Post by charlestown1978 »

I have searched and cannot find a clear answer. For Dependent Care FSAs, is it when we pay or when the services are received?

For example, my FSA plan year starts in July but day care requires the first payment for September 2014-May 2015 in March 2014. That is, we pay in March but don't receive any services till September and my plan runs from July 1 to June 31.

Thanks
Snorcub
Posts: 1
Joined: Mon Jan 13, 2014 12:45 pm

Re: Dependent care Fsa

Post by Snorcub »

Mine definitely only reimburses once the services have been received.

For example, if I pay in January for February child care, my FSA won't look at my claim until Feb 28th.

I am not sure if this is specific to the company that runs my FSA, or if it is more universal. I suspect the latter, because I have heard other parents express frustration with the cash-flow issues their FSA creates.

I hope this helps!
Rupert
Posts: 4122
Joined: Fri Aug 17, 2012 12:01 pm

Re: Dependent care Fsa

Post by Rupert »

There are several threads here addressing this question; so you might search for those. I avoided the problem by submitting monthly affidavits instead of receipts to my Dependent Care FSA provider for reimbursement. I might pay three months in advance but the affidavit, which was a form provided by the provider, simply said "X Child attended daycare from July 1-August 1 and X amount was paid for that service." The daycare director signed the form. I signed the form. The Dependent Care FSA provider never questioned it or demanded additional evidence.
NAD83
Posts: 123
Joined: Thu Apr 07, 2011 1:25 pm

Re: Dependent care Fsa

Post by NAD83 »

I can't use any money in the FSA until I can show a statement that care was provided. And, unlike a health FSA, I can't use the money until it is actually in the account. I just avoid any hassle and extra time and send in an end-of-year statement from the daycare to the FSA account, and they deposit $5,000 in my account. Forced savings; tax benifits.
Post Reply