Advanced Benefits - PSFT (MOSC)

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Dependent Care Flexible Spending Account limit

edited Jul 17, 2024 3:07PM in Advanced Benefits - PSFT (MOSC) 7 commentsAnswered ✓

The federal maximum deduction for dependent care benefits under a Dependent Care Flexible Spending Account is $5,000 per year, applicable to both married couples filing jointly and single filers. For married individuals filing separately, the limit is $2,500 per year. However, we cap the deduction at $5,000 for both married and single filers.

We use two deduction codes for FSA and run an end-of-year query to determine who has reached the $5,000 maximum by summing the amounts from both codes. For employees exceeding the $5,000 limit, we add the excess to their taxable gross income.

I am aware that we can set a limit for a single deduction code in the deduction table, but has anyone managed to do this for two deduction codes?

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