This information provided is for illustrative/educational purposes only. This material is not intended to constitute legal, tax, investment, or financial advice. Effort has been made to ensure that the material presented is accurate at the time of publication. However, this material is not intended to be a full and exhaustive explanation of the law in any area or of all of the tax, investment or financial options available. It is advised to consult a qualified tax or financial professional for your particular situation.
Select a Tax Year above to begin
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Tax Filing Status Buttons: Your planned tax filing status for the tax year.
Adjusted Gross Income: Your estimated Adjusted Gross Income (AGI) for the tax year. AGI is defined as gross income minus adjustments to income. Gross income includes your wages, dividends, capital gains, business income, retirement distributions as well as other income. Adjustments to Income include such items as educator expenses, student loan interest, or contributions to a traditional retirement account.
State/Local Income Tax %: Your marginal state income tax plus any local income tax.
Earned Income: Earned income includes the taxable income and wages you get from working for someone else, yourself, or from a business or farm that you own. For the majority of individuals, earned income is your annual wages minus any non-taxable items such as traditional employer retirement account contributions (401k, 403b, etc.), health care premiums, FSA contributions, HSA contributions, etc.
Number of Children: Number of qualifying children under age 13 whom you can claim as a dependent. If the child turned 13 during the tax year, the child is a qualifying person for the part of the year he or she was under age 13. Special rules exist for children of divorced or separated parents or parents who live apart (beyond the scope of this tool).
Social Security Wages: For the individual contributing to the Dependent Care FSA, include all wages minus employee paid healthcare premiums and contributions to flexible spending accounts.
Qualifying Expenses: Enter the qualified expenses you expect to incur and pay in the tax year. Qualified childcare expenses include daycare, preschool, day camps, and before and after school programs. Do not include the cost of schooling for a child in kindergarten or above, overnight camps, summer school, or tutoring programs.
Tax Credit Value: Approximate value of fully utilizing the Dependent Care Tax Credit in the tax year. Form 2441 should be filed along with your tax return to take advantage of the Dependent Care Tax Credit.
DCFSA Value: Approximate value of fully contributing up to your employer’s plan limit in a Dependent Care Flexible Spending Account in the tax year. This figure accounts for the pre-tax savings (Federal, State and Local taxes, Medicare, and Social Security), as well as the value of utilizing the Dependent Care Tax Credit for any qualified expenses above the DCFSA limit.