I have a Dependent care FSA account of $5000 with my employee and have been claiming reimbursements. However, my wife who has been actively looking for work and have all email records of job applications and interview invitations hasn't been successful in landing a job this year yet. She does have rental income though. Would you please let me know if we are still eligible for FSA? If not, do I have to return the $5000 reimbursement I received to my employee or how should I file tax return to avoid any filing error and pay the correct tax amount? And is there any penalty? Thank you so much.
