Numbers for dependent care are not adding up

[HW11]

My husband has 2 W2s.  Same company, but they just switched him from head office to the local branch.  He has a child care FSA.  Box 10 on one is $1728, the other is $3264.  So that adds up to $4992.   

But TT says "you have $4228 of employer-provided care benefits"  So why is that different?

THEN, when I enter the expenses, which were $5980, when it goes back to the summary screen it says total care expenses is $2716 and that they are adding $1728 of the dependent care benefit to this year's income.

What is going on?  None of these numbers are making sense.  Also, why should any of the benefit be added back to taxable income when we used all of it for child care??

[JamesG1]

There are some details missing.  

You are reporting a married filing jointly tax return.  How many qualifying dependents received the $5,980 in dependent care benefits?

Is there income reported on the tax return for the spouse?  Was the spouse reported as a full-time student?

The computations that you are asking about may all be observed on IRS form 2441 Child and Dependent Care Expenses.  The computation of taxable benefits may be found on line 26 (see page 7) of the form.

In the online versions, you may view or print at Tax Tools / Print Center / Print, save or preview this year's return / Include government and TurboTax worksheets after you have paid for the software.

In the Desktop versions, one can look at the tax return by clicking FORMS, or by viewing the PDF through the Print Center.

@HW11 

[HW11]

We are married filing separately and have one child.

I will have a look at that form.

Thank you!

[Opus 17]

@HW11 

”we are married filing separately”

That’s the answer. When married filing separately, the maximum allowable dependent care FSA is $2500. Any excess over that amount will be added back to taxable income. Additionally, married, filing separately is not eligible for the dependent care credit, so even if your expenses are more than $2500 there won’t be any additional credit.