Dependent care FSA

A Dependent Care flexible spending account (FSA) is a pre-tax account dedicated to covering dependent care costs while you are at work. A dependent is a child under 13 years of age and adult dependents who cannot take care of themselves. 

Your Dependent Care FSA election amount can’t be changed during the year unless you experience a qualifying life event such as a marriage or a birth. A Dependent Care FSA plan also can’t be taken with you in the event that you leave Madison House, the money will be forfeited. 

Madison House’s Dependent Care FSA plans begin December 1st and lasts through November 30th. It is important to accurately estimate your annual election amount based on approximately how much you typically spend on dependent care annually.

Maximum pre-tax deduction amount 

The fund for the Dependent Care FSA will be taken out of the employees’ paycheck pre-tax. 

  • Elect to use up to $5,000 for single taxpayers and married couples filing jointly.  

  • Elect to use up to $2,500 for married individuals filing separately 

Important:

**You will have until March 15th to submit receipts for the previous plan year.

Dependent Care Funds guidelines

Funds can be used to pay for eligible expenses, but the employee can only use the funds that are in the account. Funds cannot be accessed in full amount the first day (like the Healthcare FSA), they can only be used when the funds are built up in the account. Dependent Care funds will be reimbursed as they are paid into the account.

Example: If you submit a $600 receipt in January and only $400 is in the account, the $400 will be reimbursed immediately and the remaining $200 will be reimbursed when it becomes available.

Dependent Care FSA at the end of the plan year

Money in the Dependent Care FSA account must be spent by the end of of the ‘run-out’ period for the plan year (Dec 1 - Nov 30). If any money is left at the end of the plan year, the money is forfeited to the employer per IRS regulation. 

You need to incur all expenses prior to the end of the plan year. If your employer offers you a grace period, you have an additional 2½ months after the end of the plan year to incur expenses.

Log into your WageWorks account to check your plan year end date. Check the Dashboard tab to see both the “Use It By” date as well as the “Claim It By” date for each of your benefit accounts.

Dependent Care FSA Payment Options

You will receive an FSA Debit card in the mail shortly after you enroll in the FSA. This can be used for copays and prescriptions. Amounts that are not the standard copay amount or not at a pharmacy will require receipts. Save all your receipts until the plan year is over.

The employee can use the funds either through Pay My Provider or through Pay Me Back. 

Pay Me Back: Receipts can be submitted to WageWorks and they will be reimbursed through direct deposit or by check.

Pay My Provider: You can arrange to pay your dependent providers directly from your WageWorks account for your eligible expenses. Here’s how it’s done:

  1. Log into your WageWorks account on the app or website

  2. Click on Submit Receipt Or Claim.

  3. Select the Pay My Provider option.

  4. Select the WageWorks account that should pay your provider.

  5. Request One-Time or Recurring Monthly payment.

  6. Enter the required payment information and select Submit Claim.

  7. Upload digital copies of your invoice or receipts.

  8. WageWorks sends payment(s) directly from your account to your provider.

Eligible Expenses of the Dependent Care FSA

  • Before or after school programs for children

  • Child care/ Elder day care 

  • Preschool

  • Summer day camp

Recommendations for Ease of USe

1) Install the EZ Receipts app. You can check you balance, status of a claim and submit receipts easily through the app. The app is easier to use than the website. You can easily snap a photo with your phone through the app to submit a claim for reimbursement.

2) Setup Direct Deposit through the app for ‘pay me back’ claims. After setting up direct deposit it takes 2-3 business days for the direct deposit details to be connected to your account. Normal claims take 2-3 business days to process and deposit into you account.

LEAVING MADISON HOUSE

You have 30 days from the last day of employment to use your Dependent Care FSA funds. All funds that have not been claimed before the 30 day period will be forfeited.