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Let's say I have contributed and used $5,000 in 2018 for my dependent care FSA. Late in the year, I get a new job. Can I contribute to the new account for 2018?

According to Zenefit, the healthcare FSA limit resets when you get a new account, but they say

This specifically applies to Health Care FSA's only, not Dependent Care FSA's.

Can anyone confirm whether I can contribute more than $5,000 to a dependent care FSA if I change jobs during the year? Thanks.

  • Since it's use-it-or-lose-it, why would you want to? – RonJohn Sep 28 '19 at 18:23
  • @RonJohn so that I can use it for qualifying daycare expenses before the end of the year. – NSouth Sep 28 '19 at 18:25
  • Since you'd already contributed and spent the limit, what would you have done if you'd not changed jobs? – RonJohn Sep 28 '19 at 18:28
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No. In a single year you cannot contribute more than $5,000 total to all employer sponsored Dependent Care FSAs.

The best reference I have found for this is in the instructions for calculating the Child and Dependent Care Credit, in IRS publication 503. When calculating the allowed federal tax credit, you must first subtract out any employer provided Dependent Care FSA amounts first, and use the remainder to calculate any available amount for the credit. In the section "Can you claim the credit", #7 states:

If you exclude or deduct dependent care benefits provided by a dependent care benefit plan, the total amount you exclude or deduct must be less than the dollar limit for qualifying expenses (generally, $3,000 if one qualifying person was cared for or $6,000 if two or more qualifying persons were cared for). (If two or more qualifying persons were cared for, the amount you exclude or deduct will always be less than the dollar limit because the total amount you can exclude or deduct is limited to $5,000. See Reduced Dollar Limit under How To Figure the Credit, later.)

In other words, if you have two or more children (or dependents), then the federal expense limit is $6,000 minus the amount you already deducted from a Dependent Care FSA, which could be up to a maximum of $5,000. This implicitly states that it doesn't matter how many employers you've had, the max is still $5K.

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I haven't found the actual IRS regulations regarding this, but Investopedia says that the limit is for the year, saying nothing about how that is divided amongst multiple plans.

The IRS limits the total amount of money you can contribute to a dependent care to $5,000 each year for married couples filing jointly, unmarried couples and single individuals and $2,500 if you are married and filing separately.

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I never got an explicit answer, but HR pretty much regurgitated

This specifically applies to Health Care FSA's only, not Dependent Care FSA's.

So I'm assuming it does not apply to dependent care FSAs.

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  • You'll find out for sure next year when you do your taxes... :) – RonJohn Oct 5 '19 at 23:58

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