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Nov 1, 2023 3 min read

Is a Dependent Care Flexible Savings Account (FSA) Right For Your Family?

Courtney McGann By: Courtney McGann

This blog was originally published on Nov. 2, 2022, and updated with new information on Nov. 1, 2023. If your employer gives you the option of setting money aside in a dependent care flexible savings account, it’s worth taking a closer look to see how it could save your family money.

Here’s a quick overview to help you decide if such an account is right for you!

What Is A Dependent Care FSA?

A dependent care flexible spending account (FSA) is a pre-tax benefit account that is used to pay for eligible dependent care services such as preschool, before and after school programs, day camps, as well as child or adult daycare.

Money is deducted from your paycheck and you withdraw it to pay for care of those who depend on you. 

For child care, the money from the dependent care FSA can be used for the care of those 13 years old and younger.

Expenses typically not covered include activity fees, field trips, diapers, tutoring and meals.

And tuition for kindergarten or private schools is not a qualifying expense either. That’s because the IRS says that is an educational expense, rather than a child care expense.

Mom uses dependent care account to pay child's daycare.

What Paperwork Do I Need to Submit?

Keep your receipts! Keep your receipts! Keep your receipts! 

You’ll typically be asked to attach an itemized receipt each time you make a withdrawal from your dependent care FSA. Information that is required includes the tax ID of your daycare, the tuition amount, the names of your children and dates the care was provided.

You’ll most likely be asked to submit this information online for reimbursement.

Credit card receipts, canceled checks and balance forward statements won’t cut it for acceptable documentation.

a woman studies a receipt with calculator in hand

How Much Can I Contribute?

For 2024, the maximum amount that can be contributed to a dependent care account remains at $2,500 for those who are married and filing separately, and at $5,000 for those who single or married filing jointly.

Can I Change How Much I Contribute Outside Open Enrollment?

This is a good question to ask your human resources department. Typically, you cannot change your FSA contribution midyear. But you might be able to, if you have a “qualifying event” such as the birth of a new child. 

Don’t hesitate to reach out to your benefits coordinator to make sure you’re allocating the amount of money that best suits the needs of your family.

How Procare Can Simplify Dependent Care FSA

Procare Solutions offers financial management tools to child care centers, including the ability to do multi-family billing and send invoices. Procare takes care of automatic billing and payments, making it easier for parents to receive the documentation needed to file claims to their dependent-care account administrators for reimbursement.

A full end-to-end solution that provides child care management software and payment processing in one place makes your business more efficient while improving your bottom line.  

With Procare, you get a solution that helps you manage these top challenges to drive more to your bottom line and increase your profitability, including: 

  • Enabling families to pay via the Procare child care mobile app 
  • Automated invoicing 
  • Ledger posting 
  • Quicker funding (next day in most cases!) 
  • Reduced administrative payroll hours processing tuition payments

Want to know how much time and money you could save by using Procare’s secure and effortless child care payment processing? Enter some details into this online calculator to learn about your potential savings of using automation! 

Procare Cost and Time Savings Calculator Automated Payment Processing Cost
& Time Savings Calculator
Digital Curriculum Cost and Time Savings Calculator

Image of Tucker calculating your savings Image of Tucker calculating your savings Image of Tucker calculating your savings

Calculate your potential cost and time savings by using Procare’s all-in-one child care management software. All we will need from you is some information about your child care location*: Calculate your potential cost and time savings by using Procare’s secure and effortless child care payment processing. All we will need from you is some information about your child care location*: Calculate your potential cost and time savings by using Procare’s classroom management. All we will need from you is some information about your child care location*:

View Savings

* Our data model is based on our experience working with over 100,000 child care centers, before and after school programs and youth organizations since 1992.

Switching to will save you
hours and a month!* a month!

Manual Procare
Time(hr/month) Cost($/month) Time(hr/month) Cost($/month)
Family Registration
Attendance Tracking
Family Communication and Engagement
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Payment Processing
Classroom Management
Family Registration
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Manual Procare
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Manual Procare
Time(hr/month) Cost($/month) Time(hr/month) Cost($/month)
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Time(hr/month) Cost($/month) Time(hr/month) Cost($/month)
Classroom Management
Manual Procare
Time(hr/month) Cost($/month) Time(hr/month) Cost($/month)

The cost and time savings shown here are what the Procare all-in-one solution will help you save at your child care organization. Fill out the form below to see the full breakdown.

We understand that smaller centers and in-home daycare providers are operating on a tight budget, and that is why we provide all these features for the affordable price of just $25 per month. Let us handle the business of child care so you can get back to caring for your children.

To learn more about Procare home version, click below.

*Please note that the report you see only factors in cost and time savings for the in-home solution features. For Procare home version users that are interested in seeing how they can benefit from Procare’s full suite of capabilities, contact us today to speak to a Procare representative.​ *Please note that the report you see only factors in cost and time savings for the in-home solution features. For Procare home version users that are interested in seeing how they can benefit from Procare’s full suite of capabilities, contact us today to speak to a Procare representative. *Please note that the classroom management functionality is not available for in-home users. For Procare home version users that are interested in seeing how they can benefit from Procare’s full suite of capabilities, contact us today to speak to a Procare representative.

Image of Tucker calculating your savings
Cost & Time Savings
Date
Automation
Number of Staff
Number of Students
Hourly Rate
Savings per Month

For over 30 years, Procare Solutions has helped child care businesses big and small tackle their biggest operational challenges.

From contactless check-in, attendance tracking and staff management to family engagement, tuition collection and extensive reporting, we have the solutions that child care professionals want most.

More than 37,000 child care businesses choose Procare because we give them everything they need to focus on what they love—providing amazing experiences to the children in their care.

Our data model is based on our experience working with over 100,000 child care centers, before and after school programs and youth organizations since 1992.

Learn more at procaresolutions.com

Procare Cost and Time Savings Calculator

Family Registration Manual Procare
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Enrollment
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Family Communication and Engagement Manual Procare
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Child Activity Tracking
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Meal Planning
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Financials Manual Procare
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Financial Reporting
Business Planning and Reporting
Staff Time Tracking / Scheduling
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Payment Processing Manual Procare
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ABOUT THE AUTHOR

Courtney McGann

Courtney McGann is a Demand Generation Specialist at Procare Solutions, where she works with the team to nurture client relationships and bring in interested potential advocates by providing engaging content and sharing child care industry news, trends and best practices. She is also a new mom who appreciates the child care providers in her life.

Courtney McGann