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Dependent Care Tax Credit VS. Dependent Care Spending account

Dependent Care Tax Credit vs. Dependent Care Spending Account

Use the charts below to help determine which option is best for you. Keep in mind that each person’s tax situation is unique, therefore you may want to consult your tax advisor before enrollment.

Single or
Head of Household Single or
Head of Household Single or
Head of Household Married,
Filing Jointly Married,
Filing Jointly

2 Eligible Dependents and $6,000 in Dependent Care expenses

Adjusted Gross Income

OVER

$10,000

$39,000

BUT NOT OVER

$39,000

$182,000

BEST OPTION

Tax Credit

*Spending Account

*Refers to $5,000 under Cafeteria Plan and $1,000 tax credit

1 Eligible Dependent and $3,000 in Dependent Care expenses

Adjusted Gross Income

OVER

$10,000

$39,000

BUT NOT OVER

$39,000

$182,000

BEST OPTION

Tax Credit

Spending Account

1 Eligible Dependent and $5,000 in Dependent Care expenses

Adjusted Gross Income

OVER

$10,000

BUT NOT OVER

$182,000

BEST OPTION

Spending Account

2 Eligible Dependents and $6,000 in Dependent Care expenses

Adjusted Gross Income

OVER

$14,000

$39,000

BUT NOT OVER

$39,000

$200,000

BEST OPTION

Tax Credit

*Spending Account

*Refers to $5,000 under Cafeteria Plan and $1,000 tax credit

1 Eligible Dependent and $5,000 in Dependent Care expenses

Adjusted Gross Income

OVER

$10,000

BUT NOT OVER

$131,000

BEST OPTION

Spending Account

The above information is intended for illustrative purposes only and is not intended to constitute legal or accounting advice. The above information does not substitute for personalized professional tax advice. Each person’s tax situation is unique. Prior to enrolling in the Dependent Care Spending Account, each person is encouraged to consult with their personal tax advisor.

2 Eligible Dependents and $6,000 in Dependent Care expenses

Adjusted Gross Income

1 Eligible Dependent and $3,000 in Dependent Care expenses

Adjusted Gross Income

1 Eligible Dependent and $5,000 in Dependent Care expenses

Adjusted Gross Income

2 Eligible Dependents and $6,000 in Dependent Care expenses

Adjusted Gross Income

1 Eligible Dependent and $5,000 in Dependent Care expenses

Adjusted Gross Income

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