I currently have an employer. It is on a calendar plan year 1/1/24 - 12/31/24.
I have contributed $3461 to my Dependent Care FSA this year (a $192 deduction per paycheck, going for the full $5,000). I am going to leave my job this week.
My spouse's job also offer a Dependent Care FSA but we don't use it (because of the $5,000 max contribution rule). Her plan is on a Fiscal Year Calendar 7/1/24 - 6/30/25.
Assuming we enroll in her plan effective 10/1/2024, here are my questions:
- How is the new DCFSA contribution amount treated on our taxes and how does the $5,000 annual rule factor in? If we elect to put in $4,000 on the new plan (spouse's employer) is that spread pro rata on our taxes over 12 months from 7/1/24 to 6/30/25 or pro rata over 9 months from 10/1/24 to 6/30/25?
- I saw another post that suggested that it depends on what the timing is of the expenses we use it for
- Assuming there are 6 more paychecks in the year and then 13 in 2025 before the end of the plan year if we elect $4,000 that is $210 deduction per paycheck * 6 = $1,260 for the rest of calendar year 2024. $5,000 annual cap - ($3461 that I contributed at my prior employer) - $1,260 in new contributions is less than $5,000, so that seems ok. Right?
- Then the remaining $4,000 - $1,260 = $2,740 is contributed from 1/1/25 to 6/30/25 over 13 paychecks?
- Will we be able to submit any expense incurred from 7/1/24 to 6/30/25 or only from 10/1/24 to 6/30/25?
- We have plenty of childcare expenses, so for the purposes of offering advice, please assume that if we "need" expenses that occur within a specific date, we have them to submit
