Dependent Care Flexible Spending Account for Military Families & Spouses
The cost of day care for children or supervision for an aging parent can be a significant expense for many families. A DCFSA can help pay for out-of-pocket eligible expenses tax-free. Qualifying expenses include those incurred to help you and your spouse go to work, study and look for a job.
A Dependent Care Flexible Spending Account (DCFSA) is a pre-tax account used to pay for eligible dependent care services such as child or adult day care.
Enrollment in a DCFSA is open to DoD civilians, regular (active) component service members, and Active Guard Reserve members on Title 10 orders who have dependents with eligible expenses.
Here are some tips from financial experts to help you build a spending plan:
- Create or update your spending plan. Focus on essential living expenses and try to minimize discretionary spending. Determine where you can cut and divert that money to savings. Review your current spending for areas to consider, where possible, cutting back.
- Prioritize your bills and contact your lenders if you need help making payments. Many lenders will allow you to defer payments such as mortgages, rent, car loans and credit card payments. Others are temporarily suspending late fees or collection efforts of past due payments.
- Check with your service relief society for additional assistance. Military relief societies may offer immediate, no interest loans or grants for financial needs.
Army Emergency Relief: https://www.armyemergencyrelief.org/
Navy-Marine Corps Relief Society: https://www.nmcrs.org
Air Force Aid Society: https://www.afas.org
Coast Guard Mutual Assistance: https://www.cgmahq.org
Quickly Determine Eligibility
You must have an eligible dependent and use eligible dependent care services to allow yourself and your spouse (if applicable) to work, look for work or attend school full-time.
Your dependent must be claimed on your tax return for the year you are enrolling in a DCFSA.
If your spouse is a full-time student or incapable of self-care, for purposes of DCFSA eligibility, your spouse is considered to have $250 per month in earned income for your first dependent, and $500 per month in earned income if you have two or more dependents.
Common Eligible Expenses
Preschool & After-School Care
Day Care
Day Camp
Eligible Dependents
Children under age 13 who are claimed as dependents for tax purposes
Spouse or dependent of any age who is physically or mentally incapable of self-care
Ineligible Expenses
School tuition expenses (kindergarten and above)
Services provided by one of your dependents
Night-time babysitting (unless you work nights when the expenses are incurred)
Overnight camps
Nursing homes, medical care or other residential care centers
How Much Can I Contribute?
$100-$5,000 Pre-tax Earnings
- You may contribute a minimum of $100 and a maximum of $5,000 or up to the amount of your total earnings if you earn less than $5,000 per calendar year into a DCFSA.
- However, your marital and tax filing status may impact the amount you are able to contribute.
Deadlines
- You may only enroll in a DCFSA during the Federal Benefits Open Season, typically held mid-November through mid-December each year, or when you have experienced a Qualifying Life Event (QLE) such as the birth or adoption of a child, a divorce, or relocation.
- The DCFSA operates on a calendar year basis, starting January 1 and ending December 31.
- There is a grace period through March 15 of the following year to incur expenses. Claims can be submitted through April 30 of the following year.
- Any funds remaining in a DCFSA after April 30 of the following year are forfeited.
“My spouse is active component and we have three dependents - two children under the age of 13 and my father who is a disabled veteran. I was the sole care provider for our family but am now returning to work part-time and will be hiring an au pair. Am I eligible to enroll in a DCFSA benefit or must my spouse?”
Good news! You are eligible. Your active component spouse can enroll or you can enroll through your employer. However, the maximum contribution per tax year is $5,000 for a family whose tax status is married filing jointly.
Resources
Resources
Recent Blogs
5 Financial Resolutions to Start the New Year Off Right
You don’t need to wait until January to take a fresh look at your finances. Get a jump on the new year with these five resolutions — they can really pay off over the next 12 months. 1. Set/update your budget Setting a budget is the first step in a military family’s financial planning. And…
Read More
5 Financial Power Moves for MilSpouses
During National Veterans and Military Families Month in November, we salute the strength of our families as they support the mission of our community. MilSpouses, especially, display determination as they face the challenges of military life. We see you navigate frequent moves, deployments and often raising children as a solo parent. We understand your motivation…
Read More
The Year In Review: Bring Your Financial Picture into Focus
It can be fun and even eye-opening to watch those year-end montages reminiscing about the year. If you ever have that moment when you say to yourself, “Wait, that was this year?”, you could also imagine how easy it could be to lose track of the goals and financial plans you set in motion when…
Read More
Now’s the Time to Think About Life Insurance
Hey, MilSpouses, it’s Life Insurance Awareness Month! Okay, so maybe that doesn’t make you want to break out the cake and ice cream, but life insurance is an important part of your financial plan. It can help take care of your family, giving them financial security if something happens to you or your service member.…
Read More
Budget and Insurance: What to Do After You PCS
After months of planning and hard work, you’ve landed safely at your next duty station. Congratulations! As you kick off this next chapter in your MilLife, it’s a good time to check in on your finances. Let’s look at two key items that are likely to change after a PCS: your budget and your insurance.…
Read More
Insurance and Estate Planning for Your Peace of Mind
Insurance protection and estate planning are key to your family’s financial peace of mind. Insurance protects you from serious financial loss and provides for your family, and estate planning ensures your wishes are carried out in case you are no longer there. Protect Your Stuff Homeowners and Renters Insurance: Both homeowners and renters insurance cover…
Read More
PCS Finances for MilSpouses: In Their Own Words
Did you set financial goals earlier this year only to have a permanent change of station (PCS) threaten to derail your family’s budget? You’re not alone. Other MilSpouses have learned how to keep their family finances intact during a move — and so can you! Here is valuable advice from their experiences. PCS-proof Your Finances…
Read More
Showing Appreciation with Top Resources for MilSpouses
As MilSpouses, we are often asked to shoulder a big load of responsibility. When partners deploy or work long hours, managing career and home responsibilities — especially finances — can fall on us. May 10 is Military Spouse Appreciation Day, and we pause to honor your unwavering support, strength and resiliency in all you do…
Read More
