Thank you! What do you think about my third question "no one is going to pay tax on that $5000, is it reasonable?"
The reason I was asking was because someone brought up that issue in another similar grandparents nanny topic.
That person said " Someone is going to pay tax on that income, either you or your parents".
In my situation, neither me or my parents need to pay any FICA or income tax on that $5000 we contribute to the FSA dependent account. Would IRS be mad about it?
