Accounts
Dependent Care FSA
A pre-tax account for child care, day camp, and eligible adult dependent care
Key takeaways
- Reimburses work-related care for children under 13 and for dependents incapable of self-care.
- The 2026 limit rose sharply to $7,500 per household ($3,750 if married filing separately).
- Unlike a Health Care FSA, funds are available only as they are contributed — not all at once.
What it is
A pre-tax account for child care, day camp, and eligible adult dependent care. The account is a structure; the investments it holds are separate and carry their own risks.
How it works
- Elect an annual amount during open enrollment.
- Pay your care provider, then submit for reimbursement.
- Use the funds by the plan-year deadline.
Eligibility
Offered through an employer plan. Care must enable you (and your spouse, if married) to work or look for work.
Contributions and funding
For 2026, $7,500 per household, or $3,750 for married individuals filing separately — an increase from $5,000, enacted in July 2025.
What it can hold
Cash balances used to reimburse qualified dependent care expenses.
Taxes and reporting
Contributions are excluded from gross income. Amounts reimbursed cannot also be claimed for the Child and Dependent Care Credit. Requires tax review
Withdrawals and distributions
Reimbursed as expenses are incurred, up to the amount actually contributed to date.
Risks and limitations
- Use-it-or-lose-it; no carryover is permitted for dependent care
- Reimbursement is capped by your contributions to date
- Interacts with the dependent care tax credit — coordination matters
Frequently asked questions
Does it cover overnight camp?
No. Day camp can qualify; overnight camp does not.
Is there a carryover?
No. The carryover provision applies to health FSAs, not dependent care FSAs.
Can I use it for my parent?
Yes, if the parent is your tax dependent and incapable of self-care, and the care enables you to work.
Educational only. This page is general information, not individualized investment, legal, or tax advice. Rules depend on your account type, transaction, tax year, and circumstances — consult a qualified professional.