@serhatyal wrote:
@Opus 17 Thank you for your message. After considering it further, I decided not to use DCFSA for the payment I made to my mother due to potential complications.
I have several other expenses such as pre-k, summer school, and after-school programs that exceed our limit (married) of $5000. However, I have already reimbursed the $1500 payment I made to my mother through WageWorks. Now, I have two options:
1. Return the money to WageWorks by sending a cheque and then claim $5000 with the pre-k invoice.
2. Keep the money and claim the remaining amount of $3500 with the pre-k invoice.
Option 2 is easier, but there will be a discrepancy between my tax return (pre-k invoice) and WageWorks records. This could be a problem if WageWorks shares this information with the IRS. I don't want to create any problems for my mother.
What will be your guidance? Thank you
First:
Pre-K is allowable if one of the reasons the child attends is so you and your spouse can work. The fact that the program is also educational does not disqualify it.
At Kindergarten and above, school costs are not allowable as day care. You are allowed to include the extra cost of before and after school care, if you pay extra to keep your child while you are at work, and as long as the costs are separately itemized. (Up to age 13. At age 13 and above, care costs don't qualify for the credit unless the child is disabled and unable to care for themselves, even if you feel extra supervision is still needed.)
Summer day camp is allowable if one of the reasons for attendance is to provide care so you can work. However, overnight camp is not allowable.
Now, as far as the plan administrator is concerned. To the best of my knowledge, the plan administrator does not give the IRS the name of the person or company being reimbursed. That is only reported on your form 2441. If you file a tax return and list $5000 of qualifying expenses to other providers (summer camp, pre-k, etc.) and you have $5000 of reimbursements, that should settle out ok, even if the reimbursement request you filed with the plan names a different person than the person who ultimately got paid.
