In 2021 the allowable contributions to a flexible spending daycare account were increased to $10,500 from the $5,000 in 2020. It has reverted back to $5,000 in 2022 subject to further legislative changes. With my employer we make elections for the "plan year" that runs from July to June. So I bumped up my election to $10,500 beginning July 2021. Therefore in 2021 I contributed 50% of $5,000 from Jan-June and 50% of $10,500 from July-Dec. for a total of $7,750. Since 2021 is over, I cannot change what I contributed for that calendar year. But in 2022, will I be able to contribute half the year at $10,500 and half at $5,000 (assuming no further legislation) for a total again of $7,750? Or will my contributions stop in 2022 when I reach $5,000? I have read that the $10,500 limit was for a "plan year" so just not sure how the IRS will monitor this and whether Turbo-tax will handle it correctly.
