My wife and I file jointly, we both work full time, 22% tax bracket, and have one child dependent in full time day care.
She has $5000 withheld from her paycheck thru work and placed in a dependent care FSA. This amount has been noted in box 10 of her W2. Our total daycare expenses are over $15,000 per year and have the proper documentation with EIN.
Turbotax is telling me that we don't qualify for the Child and Dependent Care Credit. I understand that you're not allowed to double dip the same child care dollars when looking at the deduction and credit (which would be the case if you have less than $5000 expenses). I'm confused because we are paying over $10,000 in out of pocket child care expenses not paid for by the $5,000 in pre-tax FSA dollars. So it seems we have more than enough non double dipped expenses to take advantage of the $3000 qualifying expenses.
Am I missing something or is turbotax incorrect? Thank you.
