Support builds for doubling dependent care FSA annual max
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Congressional support is picking up for legislation that would increase the maximum annual contribution employees can make to dependent care flexible spending accounts.
Under Section 129 of the Internal Revenue Code, employees can make up to $5,000 a year in pretax contributions to dependent care FSAs.
Those contributions can be used to pay for a wide range of dependent care-related expenses, such as day care expenses for employees' children.
Under legislation, S. 2879, introduced late last month by Sens. Kelly Ayotte, R-N.H., and Shelley Moore Capito, R-W.Va., that $5,000 pretax contribution limit would be boosted, effective on Jan. 1, 2017 to $10,500, with that limit increased annually to match inflation.
Employee contributions to dependent care FSAs now average $3,355 a year, according to Aon Hewitt research.
The measure follows one, H.R. 4867, earlier introduced in the House of Representatives by Reps. Mike Kelly, R-Pa., and Linda Sanchez, D-Calif.
“This bill already has bipartisan support in the House, and we'll push for its swift passage so we can better support working women and families all across the country,” Sens. Ayotte and Capito said in a joint statement.
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