PSA: Dependent Care Flexible Spending Accounts (vent) — The Bump
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PSA: Dependent Care Flexible Spending Accounts (vent)

Something that I learned today & it wasn't explained to me as such, I thought I'd share it with all of you, too. Just in case you didn't already know. I elected to do this to try to save on taxes.

When you elect to have your child care pulled from your wages before taxes (to save on taxes), you can't get that amount reimbursed to you before you pay it in.

So, this is my scenario:  I elected $3k to be withheld from my checks this year. I pay my sitter $250/biweekly. I submitted my first claim for Jan almost 2 weeks ago, and the site says if submitted online, claims are process in 3-5 business days. So I called tonight b/c I was wondering when I would receive my reimbursement check or direct deposit. I was basically told I had paid in ~$200 so far this year, and until I have $250, they can't reimburse me for my first payment to my sitter. So I will essentially be behind the whole year, just to save some taxes..

I was so livid. I simply cannot afford to have an "extra" $500-750 floating out there while I'm trying to re-pay debts, etc. The company handling this didn't explain this online at all, prior to me making our elections. I'm so glad that the guy was really helpful & told me that this was the last day to cancel anything on my elective withholdings. I immediately called & canceled this. I also complained about the lack of communication about how reimbursements were handled. I'll get reimbursed all of my deduction for this account in two weeks.

 Sorry this is a tad wordy, but I thought it was worth sharing.

High-risk L&D nurse...If in doubt, go to triage!

Trevor Calvin 12.10.07 7:26pm 7lbs2.5oz 19.75in

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Emerson Claire 07.07.11 11:34am 7lbs7oz 20.5 in

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Re: PSA: Dependent Care Flexible Spending Accounts (vent)

  • I'm just glad you were able to cancel it still. They should definitely be more clear about that stuff. My work has people come in to help with stuff like that and I know they can be super ambiguous about rules and all that. Most don't care once they've sold you the crap. :(
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  • Ya...that's how mine is too, but even though we don't have that cash flow each pay check, we do get a nice big check a couple times a year.  You are very lucky you were able to cancel it!
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  • That is pretty standard.  How can they give you back what you haven't paid in yet?  We pay all year and file one claim back at the end of the year.
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  • image weelass24:
    That is pretty standard.  How can they give you back what you haven't paid in yet?  We pay all year and file one claim back at the end of the year.

    I also have a medical flex spending acct & I don't have to have the $$ in there to pay for something. I was told "it was the same thing." With DH's job change & pay cut, and trying to pay more than minimum payments on things I owe $$ on, I couldn't afford the extra money floating around.

    High-risk L&D nurse...If in doubt, go to triage!

    Trevor Calvin 12.10.07 7:26pm 7lbs2.5oz 19.75in

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    Emerson Claire 07.07.11 11:34am 7lbs7oz 20.5 in

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  • That's how are flex account works as well.  I think that is pretty typical.  I know I've submitted receipts before and was told they could only pay out a certain amount because that was what had been withheld.
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  • image goofyteacher:
    That's how are flex account works as well.  I think that is pretty typical.  I know I've submitted receipts before and was told they could only pay out a certain amount because that was what had been withheld.

    I think this must depend on the company, because my Medical Flex account funds are available on the first of the year, even though I haven't paid in to it yet. But my Dependent care works how she described it in the OP.

    Sorry OP, that has to be frustrating! 

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  • Yep! One of the main reasons we decided not to elect for the childcare money.  You can turn it in on your taxes at the end of the year anyway and get the same amount back. Plus it is way less stressful.

     

    My medical funds however are 100% available starting Jan 1. 

    Madeleine Elizabeth | 07.30.07

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  • image Ace1599:

    image goofyteacher:
    That's how are flex account works as well.  I think that is pretty typical.  I know I've submitted receipts before and was told they could only pay out a certain amount because that was what had been withheld.

    I think this must depend on the company, because my Medical Flex account funds are available on the first of the year, even though I haven't paid in to it yet. But my Dependent care works how she described it in the OP.

    Sorry OP, that has to be frustrating! 

     

    This is exactly how mine is apparently set-up. My Medical Flex account is set-up so that all funds are available at the first of the year.

    High-risk L&D nurse...If in doubt, go to triage!

    Trevor Calvin 12.10.07 7:26pm 7lbs2.5oz 19.75in

    Lilypie Kids Birthday tickers

    Emerson Claire 07.07.11 11:34am 7lbs7oz 20.5 in

    Lilypie First Birthday tickers

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