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Dependent Care Assistance Plan Overview

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Do you have young children? An adult dependent who needs your help?

Then a Dependent Care Assistance Plan (DCAP) might be just what you need! A DCAP plan is an employer-sponsored benefit that helps employees pay for the care of a qualified dependent. Each pay period, the employee makes a pre-tax contribution to the DCAP account. After paying for care and filing a claim, the employee receives reimbursement from the DCAP.

Qualified Dependents:

  • Contributions are tax-free (or tax-deductible)
  • Withdrawals for qualified expenses are tax-free
  • Account funds grow tax-free, with interest or investment returns
 

Annual Contribution Limits:

  • $5,000 for employees filing married
  • $2,500 for employees filing single/separate
 

Use Your DCAP to Pay for the Following (not all eligible items are listed):

  • Day care/Pre-school/Pre-kindergarten
  • Before and After school care (Extended day)
  • Summer day camps (overnight camp does not qualify)
  • Adult/Elderly care programs
  • Babysitting during work and/or college hours
  • Sick child care
  • Deposits for child care
 

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