What is a Dependent Care Flexible Spending Account (DCFSA)?

A Dependent Care Flexible Spending Account (DCFSA) is an account you can put pre-tax dollars into. You can use the account to pay for eligible expenses related to caring for your dependents while you’re at work.

This article will teach you about:

Contribution limits

You can contribute a maximum of $5000 per household to a DCFSA in 2023. If you’re married and your partner also has a DCFSA, you can only contribute a combined maximum of $5000.

Note: If you’re married and file taxes separately, each person has a contribution limit of $2500.

Eligible expenses

The IRS decides what expenses are eligible. Expenses can apply to the care of:

Your child(ren) under the age of 13
A spouse or relative who is physically or mentally incapable of caring for themselves

Some common eligible expenses are:

Preschool
Summer day camp
Before or after school programs
Babysitting and nanny expenses
Child or adult daycare

How it works

You don’t have access to all the funds at the beginning of the plan year. Your DCFSA funds accumulate throughout the year as they’re deducted from your paycheck. Once the funds have been deposited into your account, you can use them for eligible expenses incurred during the plan year.

You can use your DCFSA funds by paying for eligible expenses out-of-pocket (with your own money). You can then submit a claim to your administrator for reimbursement.

Some things to remember when submitting a claim:

You won’t get reimbursed until you incur the expense.
If your partner also has a DCFSA, you can’t submit the same claim to both accounts.

Example: Your child goes to daycare. On September 1st, you pay in advance for all September daycare fees. You submit a claim and receive reimbursement after September 31st. Your partner can’t also submit this expense to their own DCFSA.

Tip: Not sure who your DCFSA administrator is? Read about how to access your administrator's website.

Can I access my DCFSA funds if I leave my employer?

Because your employer owns your DCFSA, you can’t use these funds if you change or lose your job.

Can I use my DCFSA funds after my plan year ends?

Your employer can choose to offer a grace period. This would give you an extra 2 ½ months to spend your unused funds. It’s up to your employer whether they want to offer a grace period, and isn’t required.

If your employer doesn't offer a grace period, you must use your DCFSA funds within the plan year. You’ll lose access to any unspent funds. It’s important to keep this in mind, so you don’t contribute more money than you think you’ll spend within a plan year.