Well you've got to think about the process, but first make sure the thing you want to pay for is actually a qualified dependent care expense. Here is a list of eligible expenses from a national FSA administrator.
- You enroll in a $200 per month dependent care FSA election. (or whatever)
- You send your kid to non-educational daycare it costs $200 per month.
- Assuming semi-monthly payroll, your payroll person removes $100 from each paycheck to a pot of dependent care funds.
- You receive a $200 invoice from the daycare.
- You submit that invoice with some sort of form to the person doing the admin.
- That person approves your expense then issues a reimbursement payment.
This process will tie up your money for some amount of time. Your deduction will come out like clockwork. But there is a time-delay of potentially months between your deduction and receipt of a reimbursement.
Dependent care plans are money-in money-out. You can only file a reimbursement on funds that have actually been contributed, which is different than a medical FSA. Additionally, you can only file a claim on expenses that have actually been incurred. Dependent care FSA elections can be changed through the year on an as needed basis. This would add an administrivia burden to the person running your payroll, and if there is a payroll vendor in place, likely an actual cost.
The administrator in this situation would likely be the company. In the formalities of employee benefits there must always be a named administrator.
If your employer currently offers no benefits you should press healthcare first. Paying healthcare premiums pretax would likely save you more money and be less administration than this. Additionally, if your employer is paying for or reimbursing you for your individual health insurance that's currently illegal under the ACA.