Dependent Care Account

[sarjhawk]

How can I better predict how much I will be able to contribute to a Dependent Care Account? It seems like every year it's a different amount and it make it hard to estimate how much I'll have. It's ranged from $750 one year to the full $5,000 in another.

[RyanH5]

Hi sarjhawk,
Thank you for joining us today. 
The IRS sets an annual limit of $5,000 per year on dependent care flexible spending accounts. This amount is lowered for highly compensated employees (HCE's) to $3,600 or $300 per month enrolled. For 2023, an HCE is defined as anyone who earns over $150,000. Individual benefit plans may set additional contribution limits. 

[sarjhawk]

Thank you so much. I meet the qualification for a HCE but my employer hasn't adjusted anything yet - I'm still set on the $5,000. Will they be able to take the money away from me at the end of the year if they do indeed give me the full $5,000 and I spend it from the account?

[RyanH5]

That is going to be dependent of the details of your plan. I would advise contacting your benefits coordinator with your employer. They will be able to explain your options.