Dependent Care Accounts (DCA)

The federal Government definition of a dependent is as follows: An eligible dependent is any dependent who is less than 19 years old (or 24 if a full time student), resides in the same home as you for more than half the year and your dependent under federal income tax rules. An eligible dependent may also include your mentally or physically impaired qualifying relative who is incapable of caring for himself or herself (for example, an invalid parent). The dependent must spend at least eight hours per day in your home and that dependent may not have a gross income that exceeds the dependency exemption for the tax year.

Child care services will qualify for reimbursement from the Dependent Care Reimbursement Account if they meet these requirements:

The dependent child or relative must meet the requirements set forth above. Child care is for children up to age 13. Note: If your child turns 13 during the year, you cannot stop your contribution at that time.

The services may be provided inside or outside your home, but not by someone who is your minor child or dependent for income tax purposes (for example, an older child).

If the services are provided by a day-care facility that cares for six or more children at the same time, it must be a qualified day-care center.

The service must be incurred to enable you, or you and your spouse if you are married, to be employed.

The amount to be reimbursed must not be greater than spouse’s income or one-half your income, whichever is lower.

Services must be for the physical care of the child, not for education, meals, etc. Kindergarten expenses must separate out the cost of custodial care form education to reimburse.

Allowable Dependent Care expenses include payments to the following when the expenses enable you to work:

• Child Care Centers
• Family day care providers
• Nursery schools
• Caregivers for a disabled dependent or spouse who live with you
• Baby-sitters
• Household services, provided that a portion of these expenses are for a qualifying dependent incurred to ensure the dependent's well-being and maintenance.

DEPENDENT CARE EXPENSES THAT ARE NOT ELIGIBLE

Dependent care expenses that are provided to one of your dependents by a family member, unless the family member is age 19 or over by the end of the year and will not be claimed as a dependent

• Expenses for food and clothing
• Education expenses from Kindergarten on
• Health care expenses for your dependents