OMG, just realized I forgot to claim our FSA dependent care funds for 2016
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Anonymous
Yes, but the FSA amount offsets the amount of credit one can claim (which is already limited to $6000 for two or more kids). |
Anonymous
Right, and the FSA comes out pre-Medicare and SS tax, whereas the credit does not. If you have two or more kids, you could do $5000 in FSA, and then a percentage of $1000 in credit. |
Anonymous
https://www.babycenter.com/0_tax-time-flexible-spending-plans-versus-the-childcare-credit_3651253.bc Not worth the hassle to do the FSA all that admin work and submitting etc... |
Anonymous
I don't take financial advise from babycenter.com. But even they agree with us. "Generally, the more you earn, the more you'll benefit from an FSA, particularly if you're at or above the 25 percent federal tax bracket. Taxpayers in the 15 percent federal tax bracket who have only one child and have qualified expenses of at least $3,000 may be best off with the FSA, too." Here are the tax brackets: http://www.bankrate.com/finance/taxes/tax-brackets.aspx |
Anonymous
I do one submission at the beginning of March, so not a hassle for me. |
Anonymous
Not if you have high enough income to trigger the phase out of deductions and/or trigger AMT. FSA is "above the line" meaning the $$ never shows up as income, so you get the tax benefit, even if you lose your deductions. |