Limits on Employer Contributions to Dependent Care FSAs
Employers can also choose to contribute to employees' Dependent Care FSAs. However, the combined employer and employee contributions cannot exceed the IRS limits (the maximum annual amount is $5000 per year, or $2500 if you are married and file separate returns). For example, if an employer has elected a $2000 contribution to a Dependent Care FSA, employees may only contribute up to an additional $3000.
- Employer contributions to Dependent Care FSAs are not a match. Employees will receive the full contribution amount regardless of what their election is, even if they elect $0.
- As with Medical FSAs, employer contribution amounts for Dependent Care FSAs are set during company plan enrollment, and cannot be changed until the end of the plan year.
For limits on employer contributions to Medical FSAs, see this page.
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