Daycare costs, FSA and taxes

[Anonymous]

Last year was my son's first year of daycare. My husband put $4K in his dependent care FSA. Actual daycare costs were much more than that ($18K plus). Will we able to claim the excess over what was in the FSA on our taxes?

[Anonymous]

No.

[Anonymous]

Anonymous wrote:No.

For next year, wouldn't it be more beneficial to not do an FSA and claim the full cost on our taxes?

[Anonymous]

You can't claim the full cost. You can only claim up to $5k in your dependent care benefit.
I wish we could claim all of it. Not how it works.

[Anonymous]

http://www.kiplinger.com/article/business/T020-C001-S001-flexible-spending-account-vs-dependent-care-credit.html

[Anonymous]

The pre-tax benefit of the FSA will most likely be more than the credit. The max claim for the credit is 3k.

[Anonymous]

No, and next year he should max out the FSA ($5k).

[Anonymous]

Anonymous wrote:No, and next year he should max out the FSA ($5k).

+1

If you know you will have the $5k in daycare/camp expenses, it is better to max your FSA. The only reason I didn't do it this year is because our summer expenses could be zero.

[Anonymous]

Why can't anyone allow the full price be deducted we paid 50k for a nanny and could only deduct 4k. You should be able to deduct the entire amount. I am hopeful Trump helps with this struggle.

[Anonymous]

Anonymous wrote:Why can't anyone allow the full price be deducted we paid 50k for a nanny and could only deduct 4k. You should be able to deduct the entire amount. I am hopeful Trump helps with this struggle.

I agree it should be higher, if there still needs to be a cap. Why should I subsidize the full cost of an extremely fancy $100k nanny when quality childcare is available for a fraction of that cost?

[Anonymous]

Anonymous wrote:Why can't anyone allow the full price be deducted we paid 50k for a nanny and could only deduct 4k. You should be able to deduct the entire amount. I am hopeful Trump helps with this struggle.

I deduct $5K through an FSA, but I wish the deduction were 0. Childcare/nanny deductions are a pure giveaway to the upper middle class and the wealthy.

[Anonymous]

Anonymous wrote:Why can't anyone allow the full price be deducted we paid 50k for a nanny and could only deduct 4k. You should be able to deduct the entire amount. I am hopeful Trump helps with this struggle.

Ivanka has talked about this type of giveaway to the rich.

[Anonymous]

Anonymous wrote:

Anonymous wrote:Why can't anyone allow the full price be deducted we paid 50k for a nanny and could only deduct 4k. You should be able to deduct the entire amount. I am hopeful Trump helps with this struggle.

I deduct $5K through an FSA, but I wish the deduction were 0. Childcare/nanny deductions are a pure giveaway to the upper middle class and the wealthy.

I ran the numbers -- with two working parents making $250K, taxes are about $3K higher than with one working parent making $250K (and no child care costs with a work at home parent). So it works out about the same.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Why can't anyone allow the full price be deducted we paid 50k for a nanny and could only deduct 4k. You should be able to deduct the entire amount. I am hopeful Trump helps with this struggle.

I deduct $5K through an FSA, but I wish the deduction were 0. Childcare/nanny deductions are a pure giveaway to the upper middle class and the wealthy.

I ran the numbers -- with two working parents making $250K, taxes are about $3K higher than with one working parent making $250K (and no child care costs with a work at home parent). So it works out about the same.

Not true at all. To start with you have each working spouse paying into social security and Medicare. The social security limit is per person - not per family.