Dependent Care Reimbursement Account (DCRA) Overview

A Dependent Care Reimbursement Account (DCRA) can help you pay for childcare or eldercare services or care for a disabled spouse or dependent so that you can be gainfully employed or attend school full-time. You may request reimbursement for expenses for the following eligible dependents through your DCRA:

• Your children under the age of 13, who depend on you (and your spouse, if you are married) for at least half of their support
• Your spouse, if he or she is mentally or physically incapable of caring for himself or herself
• Other members of your family, such as your parents, a brother or sister, or children over 13, who are physically or mentally incapable of caring for themselves, and live in your home and depend on you (and your spouse, if you are married) for at least half of their support

Note: IRS regulations prevent you from using your Dependent Care Reimbursement Account to pay expenses for domestic partners and their children, or for other ineligible dependents.

Eligible expenses are those dependent care expenses incurred in order for you (and your spouse, if applicable) to be gainfully employed or attend school full-time.

If you are single, you can be reimbursed for dependent care expenses while you work or look for work.

If you are married, you can be reimbursed for dependent care expenses only if:

• The expenses are necessary for both you and your spouse to work or look for work;
• Your spouse is a full-time student during the calendar year; or,
• Your spouse is disabled and unable to provide care.

Also, to be eligible, your dependent care expenses cannot exceed the earned income of the lesser earning spouse. The IRS limits the amount you can contribute to a Dependent Care Reimbursement Account based on your marital status, your spouse's income, and your tax filing status.

• If you are single, or if you are married and file a joint tax return, you may contribute a maximum of $5,000 per year.
• If you are married and file separately, you are limited to a maximum contribution of $2,500 per year.
• If your spouse earns less than $5,000 per year, contributions cannot exceed your spouse's income unless your spouse is a full-time student or disabled and is unable to provide care. In these cases, your contribution is limited to $2,400 for one dependent, or $4,800 for two or more dependents.

Unlike a HCRA, a DCRA is "pay-as-you-go." This means that under federal regulations, you can only be reimbursed for eligible expenses up to the amount already deposited in your DCRA when you file a claim.