BillM223
Employee Tax Expert

Deductions & credits

The way it works is this:

 

You can (for 2021) put up to $10,500 into a Dependent Care FSA. This is the limit for either a Single taxpayer or for Married Filing Joint. You put in $9,000 for 2021, which appeared in box 10 on your W-2.

 

You can count up to $8,000 (for one child) in dependent care expenses for either the FSA distributions or the Dependent Care Credit. 

 

You paid $19k in expenses, presumably $9,000 of which came from your Dependent Care FSA. Since this is larger than the $8,000 limit per child, you have nothing left over for the credit.

 

The way this works is not obvious, but this is the way it works. May I assume that this is how TurboTax calculated it for you?

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