My employor withdrew $5000 from my income for child care. I forgot to redeem before 3/31/2023. I paid my own after-tax money for child care. How can I report the loss?

[xishuilianzi8]

I paid $8900 for child care. Should I get tax credit for 20% * $6000? How can I get this by using turbotax?

[rjs]

You do not report it on your tax return. There is no tax credit for unused child care funds. Check with your employer about the provisions of the employer's plan, but most likely the money is just lost and there is no way for you to recover it or get any compensation for it.

[xishuilianzi8]

Thank you very much for your reply!

I checked IRS 2441 form, according to https://www.irs.gov/instructions/i2441 "Part III. Dependent Care Benefits" line 14, should I put $5000 for line 14 as forfeited amount? How can I do this by using turbotax?

[Mike9241]

2441 

line 12 amount from box 10 of w-2

Line 13
If you had an employer-provided dependent care plan,
your employer may have permitted you to carry forward
any unused amount from 2020 and/or 2021 to use in

2022. Enter on line 13 the amount you carried forward and
used in 2022.

 line 14 less amounts forfeited in 2022 or carried over to 2023

line 15 = line 12 + line 13 - line 14

so entering amount on line 14 may not help

[rjs]

How much is the credit that you are currently getting on Form 2441 line 11?

Do you have an amount ($5,000?) in box 10 of your W-2? If you do, then one of the questions that you come to after you enter your W-2 asks whether you have a Flexible Spending Account (FSA) for child care. If you answer Yes, it asks whether you had any money left in the account at the end of the year. See the screen shot below. The amount that you enter there will go to Form 2441 line 14.

If you do not have an amount in box 10 of your W-2, and you did not carry over any money from 2020 or 2021, then you cannot enter anything on Form 2441 line 14.

The tag below your question says that you are using TurboTax Online. Is that true, or are you using the CD/Download TurboTax software?

[xishuilianzi8]

Thank you for your reply!

Sorry I made a mistake, I am using downloaded turbotax software but not online.

The credit on line 11 is $200. I have an amount $5000 in box 10 of W2. it is not FSA, it is employer-provided dependent care plan.

But from the instruction in IRS website as below, this should meet item 1 "Any amount you forfeited.", right?

Line 14

If you had an employer-provided dependent care plan, enter on line 14 the total of the following amounts included on line 12 or 13.

• Any amount you forfeited. You forfeited an amount if you didn't receive it because you didn't incur the expense. Don't include amounts you expect to receive at a future date.

• Any amount you didn't receive but are permitted by your employer to carry forward and use in the following year.

Example.

 

Under your employer's dependent care plan, you chose to have your employer set aside $5,000 to cover your 2022 dependent care expenses. The $5,000 is shown in box 10 of your Form W-2. In 2022, you incurred and were reimbursed for $4,950 of qualified expenses. You would enter $5,000 on line 12 and $50, the amount forfeited, on line 14. You would also enter $50 on line 14 if, instead of forfeiting the amount, your employer permitted you to carry the $50 forward to use during the grace period in 2023.

[rjs]

Yes, you can enter $5,000 as the amount that you forfeited. If you enter $5,000 on the screen that I showed you above, I think the credit will increase to $1,200, which is the maximum credit that you can get, 20% of $6,000. Go back and review your W-2 entries, and continue through the questions until you see that screen.

Alternatively, enter the $5,000 in forms mode on the W-2 worksheet, Part IV line 6.

[xishuilianzi8]

Got it, thank you!