"Does the cost of paying for childcare while you’re working terrify you? Don’t worry! With a Dependent Care Assistance Plan (DCAP), you can get care for the kiddos and save money on taxes. Check out this amusing, informative and short DCAP video."
After watching the DCAP video, you may be able to solve these riddles:
- Why is Captain Contributor hanging out in a park?
- Can Captain Contributor talk to the birds?
- What is with the form-fitting leotard?
A Dependent Care Assistance Plan (DCAP), also referred to as a Dependent Care FSA, is a great tool for working parents. You can set aside money before taxes to pay for care while you work for children under age 13 and adult dependents (like parents or spouses) who cannot care for themselves while you work.
DCAP Contribution Limits
A Dependent Care Assistance Plan can cover the following expenses:
- Before school care
- After school care
- Day camps
- Adult care
You cannot use a Dependent Care Assistance Plan to pay for baby sitters, overnight camps, or other childcare needs. See IRS Publication 503 for more information.
Spending with a Dependent Care Assistance Plan
A DCAP is a “use it or lose it” account. If you don’t spend your entire balance by the end of the year, you lose any leftover money.