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My husband and I just realized that we both contributed to our employer's Dependent Care FSA for 2014. He put in the maximum allowed $5,000 and I put in $3,600 for a total of $8,600. Unfortunately, we realized this after our benefits deadline for for 2014. We are worried that we will lose the excess $3,600 contributed. I have read in older posts that we should claim all of the $8,600 thru FSA and add the $3,600 to our gross income W2 claims for 2014. This would avoid any penalty. Is this correct or will we lose the $3,600? Any advice is appreciated.

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Yes, you'll be able to get the money by submitting legitimate receipts for care for your child, and at tax time you'll pay the tax on the extra $3600.

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  • Thanks. Do you know if there will be any penalty other then paying the taxes on the $3,600? I was so worried we'd be out the entire excess amount.
    – New user 5
    Dec 22, 2013 at 21:36
  • If I'm not mistaken, DCA may be taken out of income pre-FICA as well as pre income tax. If that's right, the tax return will add that back in, so an extra 7.5%. No penalty, just the tracking and submitting to get your money back. Dec 23, 2013 at 2:28

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