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How much should I put in my flex plan to cover summer camp in 2010?
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Anonymous
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Hi - It's benefits season, and I am trying to figure out how much money to allocate to the tax free childcare account for 2010. This is the first time I've had to do this, so I am clueless. What is the average cost of summer day camp for someone living in NW DC for a 5 year old from June - August?
DC is in DCPS during the year, but is in preK now. What's a nice round number to put in there? What do YOU do? TIA! |
Anonymous
| My son's summer day camp for 4 year old is 3300--From early June through August. |
Anonymous
| I remember this problem last year. We went with $3100 and it came pretty close to that (but a little over). |
Anonymous
| you can bill aftercare as well |
Anonymous
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Wide variety of options and price points.
Cheapest is to get into a DC Rec center camp, for a very low price, ~$50 per week. Slots fill the day registration opens. Sometimes there are DCPS schools that run summer schools, which can be low cost or free. Some charter schools have a summer school program, again, low cost or free for either current and/or incoming students. Next tier is the mid-priced camps. Examples. Some DCPS schools run camps via their aftercare program. For example, I've seen on Stoddert website that they have one. Evergreen Camp in Wheaton. YMCA Day Camps at Bethesda & Silver Spring locations, sometimes hosted in public school buildings. These run ~$200 to $250 per week. Then there are the camps at private schools, Sidwell, Sheridan, and at private organizations. Levine school of music, Imagination Stage. These can run $350 to $500 per week. Most camps have a range of times available, so you need to figure your minimum time frame and go from there. For example, Silver Stars Gymnasitcs is 8:30 am to 4:30 pm, so I can get by without after or before care, for ~$250 a week. A program like Levine/Imagination Stage is 9/9:30 to 3 pm, so I need either before or after or both, so in addition to the base fee of $300 per week, need to add $150 per week. So, far for my budget, my kids have always ended up at a cheaper camp, by the time I add up the cost for the full number of hours that I need. They've also been happy! |
Anonymous
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16:05 back again.
Another thing about child care costs is that there are 2 tax deductions approaches available. Place funds in an FSA, they are not subject to Federal, state, or payroll taxes, and the funds are use or lose. Up to $5,000. The other choice is to file for the Child Care Tax Credit, a complicated set of formulas, but up to $6,000 of expenses (minus the amount that you had in the FSA). A credit for 20% of the expenditure. Subject to payroll taxes. In DC, there is a credit for 1/3 of the Federal credit. So, if you put the full $5k into FSA, you can still claim $1k for Child Tax Care Credit, and get a $200 Federal , $67 DC credit. It is important not to put more into the FSA than you are going to use, because it's lost money. Generally, most people are better off using the FSA first. The savings are payroll 7.65%, Federal marginal (let's assume 25%) and state marginal (let's assume 5%). Adds up to 37.65%. But, if your Federal marginal rate is only 15%, then it adds up to 27.65%, and it's pretty close to the Child Care Tax Credit of 20%, especially if you also get a state credit, like in DC of 6.77%, so that's up to 26.77%. |
Anonymous
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pp, can you be my accountant? i am so confused.
i'm not the OP, but do summer camps and after care programs have to be licensed daycares/licensed something or others to qualify for the FSA? |
Anonymous
| OP here - THANKS for these terrific insights and advice! |
Anonymous
no, in-home care or nanny will do just fine. basically you're telling IRS you're paying someone else to be your kid's mom (j/k). |
Anonymous
| Can you "double dip"? That is, could I and my spouse both put money in an FSA for the kids? |
Anonymous
No, the FSA limit ($5,000 I believe) is per married couple , not per tax payer. Between the 2 of you, you can put up to $5K in. |
Anonymous
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The FSA limit is 5k per couple. The credit limit is 3k for one kid, 6k for two (and only some fraction of that).
If your tax bracket is greater than 20% then you max on the FSA first - to the extent that you expect to have expenses. HOWEVER: Camps range in price from $125 to $600 per week (with extended day) and you can't claim sleepaway camp. How much you put in is a function of your expected expenses. Furthermore, the credit is technically available only to families with two working* spouses (or if only one custodial parent, then that spouse must be working or looking for work. * working means working, looking for work, or attending school. Finally, the daycare provider must be willing to provide you with a TIN. Thus, if you pay your nanny under the table (shame, shame, shame), you are not eligible for any of this. |
Anonymous
| plus once the child hits 12, it all ends... |
Anonymous
| To poster 23:45 - I didn't know you could not claim sleep away camp. I claimed $2,000 this year for a sleep away camp and was reimbursed by my Flex Plan. Does this rule vary by Plan? |