A dependent care flexible spending account (DC-FSA) is an arrangement through your employer that lets you pay for eligible dependent care expenses with tax-free dollars. To have one, your employer just needs to offer it as part of your benefits.
Why get a DC-FSA?
Dependent care costs add up fast, daycare, after-school programs, elder care. A DC-FSA lets you pay for these with pre-tax dollars, lowering your taxable income and saving you money on care you're already paying for.
How it's funded
You can fund your DC-FSA through payroll deductions, before taxes are withheld.
Your employer's contribution may vary
Some employers contribute to your DC-FSA on your behalf, in addition to your own payroll deductions. Check with your administrator to confirm whether your employer contributes, and if so, how much and how often.
Using your funds
DC-FSA funds generally don't roll over, they must be used within the plan year. (See "Dependent care FSA contribution limits" for the specifics.)
Eligibility applies
Eligibility rules apply based on your dependent, your filing status, and how the expense is used. (See "Eligibility requirements for a dependent care FSA" for the full details.)