DCRA

mrsnala

Can someone school me on Dependent Care Reimbursment accounts? Starting a new job that offers one and considering doing it.

jf198400

We do it through DHs job and it is super easy, they use Wageworks to administer it. At open enrollment we elect our amount, we do the max $5000. This amount is spread out over all of his paychecks for the year so $208 per paycheck. Then I just login to the website and submit a claim and fax them a receipt from my DCP. We set it up so we then get an automatic deposit to our bank account as funds become available.

snicksnack

There are two options the account and taking off taxes.  If you are a high-end earner the account is the way to go because it allows you to save more assuming you put in 5,000. If I remember correctly anyone making over 43k can deduct 20 percent of total costs. When you do the math the account works out better.

QueSrah

Keep in mind that you can't get the money out of the account until you pay it in.  (Unlike a healthcare spending account, where you can be reimbursed for your full year's contribution on Jan. 15 if you have a large expense up front.)  I usually submit one or two big claims in the spring, then after getting a lump sum of everything contributed to date, I get my $200+ per paycheck for the rest of the year.

vvvvvfee

i would do it for the tax savings, as others have said. but it can be a hassle if you use an in-home DCP who doesn't take debit cards. i have to get reimbursed via checks in the mail like PP, and it's kind of a pain in the neck-- you have to get a receipt from the daycare provider, fill out a form, mail it, and then wait for them to cut you a check. of course you can wait and do it less often than once a month, but then you don't have the money available to you for other expenses.

Pips09

Great way to save money on day care expenses! I put the full $5000 in, and submit one reimbursement half way through the year. Then I get a lump sum of what is in the account and a payout each pay period of what was taken out. It is direct deposited for me into my account.

jlaOK

I do it for the tax savings but agree that it is a huge pain.  I do our budget w/o the contributions and then treat it as a "bonus" when I get the reimbursements.  This year I'm doing it differently and will submit the entire $5000 when we've reached it in daycare payments (this month).  I'll get a reimbursement for what I've put in from Jan-April then I'll automatically get $192/paycheck (DH gets paid every 2 weeks) for the rest of the year as funds become available.

ss265

mrsnala said:

Can someone school me on Dependent Care Reimbursment accounts? Starting a new job that offers one and considering doing it.

Not sure how much you know about the details but it's $5k per family. So the amount doesn't vary depending on how many children you have and if your husband's employer does one too, the total between both your accounts (if you both choose to do it) has to be $5k.

QueSrah

vvvvvfee said:

i would do it for the tax savings, as others have said. but it can be a hassle if you use an in-home DCP who doesn't take debit cards. i have to get reimbursed via checks in the mail like PP, and it's kind of a pain in the neck-- you have to get a receipt from the daycare provider, fill out a form, mail it, and then wait for them to cut you a check. of course you can wait and do it less often than once a month, but then you don't have the money available to you for other expenses.

It totally depends on how the employer runs their program. My employer allows us to print out a form on the reimbursement site, have the DCP sign it, I fax it in and within a week or so the company deposit the reimbursement into my checking account.  Super easy and fast.  When my receipts get ahead of what I've paid in, I start getting my direct deposit the business day after my paycheck (when I pay the money into the spending account).

amywoods824

Also keep in mind that if you and your DH file your taxes separately, the max for each of you is reduced to $2,500 (total of $5,000 for both of you).

I have one set up through my employer and like pp have said it's super easy. I get monthly statements from my dc and just upload the statement with the claim form through the DCRA website. I usually get the $ direct deposit within a few days.