CatinaT1
Expert Alumni

Deductions & credits

You will not qualify for the credit if you had pre-tax money in your FSA for Dependent Care.

 

Since you had money withheld pre-tax, you can't also take the credit.  You received tax benefit already by having it withheld pre-tax. You can't withhold pre-tax money and also take the credit, that would be getting a double tax break. 

 

The only way to have the pre-tax money withheld and take the credit is if you have more than one child. The credit limits you to $3,000 of qualified expenses for one child or $6,000 for two or more children.   If you had 2 or more children you would still have $1,000 to apply to the credit that hasn't received any tax benefit. 

  

If you have one child, having the money withheld pre-tax is your best option because you are actually getting $5,000 pre-tax instead of only getting the credit on $3,000 otherwise. 

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