I have a DCFSA at 5K. We dont qualify for Child Care credit but when we enter expenses over the 5K it increases our refund. Does it count as a deduction also?

[afaricellie]

Wondering if you dont qualify for the Child Care credit, if expenses above and beyond the 5K DCFSA are a deduction?

[KrisD]

Yes, it could count if you have more than one child.

On the other hand, your refund may have appeared as if it was adjusted when you entered the child care expenses, not because you received the child care credit, but because the program then applied those expenses to your FSA. 

Please see the answer attached:

https://ttlc.intuit.com/replies/5626928

[afaricellie]

Thanks KrisD, so similar to the HSA being a penalty when entered into wages and income until you enter again in deductions and credits by me entering in my expenses on the child care credit it verifies those expenses for the FSA were valid and then raises my return accordingly?

[KrisD]

Yes. You can check to see how everything is being reported on your 1040 by clicking on "Tax Tools" which is lower left on the screen, then "Tools" and "View Tax Summary". At this point "Preview 1040" should appear in the navigation bar (above where you clicked on "Tax Tools"). Click on "Preview 1040" and look at line 49. Thank you for using TurboTax.