Legislation Proposed to Enhance Dependent Care FSA Usage

Representative Carol Miller (R-WV) has introduced HR 9514, the Working Families Childcare Access Act. According to a press release, the bill allows certain additional expenses in a dependent care flexible spending arrangement—specifically qualified sports, tutoring, and music or art expenses. Additionally, the bill would support families by:

  • Increasing annual contribution limits to $15,000 from the current $5,000 limit
  • Eliminating the “use-or-lose” rule by allowing the rollover of saved unused dependent care FSA funds into the following year
  • Expanding qualified expenses by providing parents with the flexibility to use their dependent care FSA funds for adoption expenses, tutoring, sports, art, and music programs
  • Raising the allowable age limit for dependent care expenses for children and dependents to age 15

Currently, these tax-advantaged accounts are limited to $5,000, and any funds not used by the end of the year are forfeited.