Question
Daycare flexible spending account question.?
I am trying to figure this out. Here is my situation. I am divorced and have have joint parenting with out son. I pay his daycare. We switch years that we claim him on taxes. She usually claims the daycare amount I paid on years she claims him,because I cant claim it unless I claim a dependent. If I start this daycare fsa, would this benefit me? If I do this can you no longer claim daycare expenses?
3 weeks ago - 4 answers
Best Answer
Chosen by Asker
You cannot claim daycare expenses paid with pre-tax money. That's called "double dipping." More formally, it violates what the IRS calls the "double benefit" rule. The only time I've seen them let you get double benefit is if you qualify for the Retirement Savers Contribution Credit. You can put money in a traditional IRA or 401K and still get a credit against your taxes. Basically, it goes in tax free (or substantially reduced), and it comes back out tax free upon retirement.
Source(s)
BSBA-Accounting Univ of Southern MS 12/2004
by Lil_Dog
3 weeks ago
Asker's Rating: 
Other Answers
If you use the FSA for your daycare expenses, those expenses cannot be deducted on your tax return.
by prwagner3- 3 weeks ago
Only the parent the child lives with can claim daycare expenses. The other parent isn't allowed to even if they claim the child as a dependent. If some expenses are paid through an FSA, that decreases or eliminates the amount that can be claimed for a dependent care credit.
by Judy- 3 weeks ago
In your situation, I would NEVER do an FSA for child care. From the IRS point of view, there is not such thing as "joint parenting." Someone is the custodial parent and the other parent is the NON-custodial parent. The IRS will count the nights where a child sleeps to determine which parent has met the 183-night test. If it's not clear, the IRS will look at where the child's stuff is, their bedroom, their friends, their school, etc. Only the custodial parent can claim the child care. If the child is living with her, any FSA money for this purpose is added back to your income for tax purposes. This is true even if it's the non-custodial parent's turn to claim the child using the form 8332. (The non-custodial parent has been filing the form, right?) The form 8332 only transfers the exemption and child tax credit. HOH, day care and EIC stay with the custodial parent. PS, even in the years she is the custodial parent, she cannot claim expenses *you* paid. You need to give her the money and let her pay them.
by the tax lady- 3 weeks ago