Not eligible for Child and Dep Care Credit even though I paid >$15K to daycare?!

[Ktsmilez]

For my son, I am getting the Child Credit ($2K), but for some reason I'm not getting the Child Care Credit.  I put $4583 away last year in my company's Daycare FSA (box 10 on my W2) to help with my $15K daycare tuition.  Here's what TurboTax says: Even though you had $15,014 in care expenses, your situation allows you to claim only up to the $4,583 that you contributed to your employer's dependent care plan for this credit. Since your $15,014 of care expenses is more than this limit, your credit amount is $0.

Further questions from TT: "How did you calculate my $0 of unspent care benefits?  Your $0 of unspent care benefits comes from your $0 of unspent benefits.  "Where did my $0 of unspent benefit come from?" Your $0 of unspent benefits comes from $0, 0, 0, 0, and 0.

WHAT?!

[Critter · Accepted solution]

Ok ... you may be misunderstanding the screen ...   the credit for one child is based on a max of $3000 which is paid by the FSA first leaving nothing for the credit to be calculated on ... the excess expenses and FSA are immaterial ... review the actual form 2441 to see how the rules play out. 

[Ktsmilez]

Well that's downright criminal.  Who in this country has a $3k child care bill?  I'd love that!  Makes me wonder what the point of a daycare FSA is...  I can only hope the pretax deduction kept me in a lower tax bracket than if I'd not done it at all and got to claim this deduction instead.

[Critter]

Complain to those who can change the rules if you don't like them ... call your congressperson.