Adult Day Care: FSA Eligibility

Adult day care reimbursement is not eligible with a flexible spending account (FSA), health savings account (HSA), a health reimbursement arrangement (HRA) or a limited care flexible spending account (LCFSA). Adult day care may qualify under a dependent care flexible spending account (DCFSA) when the adult is physically or mentally incapable of self care and qualifying tax dependent of the account holder.

What is Adult Day Care?

Adult day care is designed to give caregivers the ability to take care of other obligations (work, school, etc.) throughout the day while the care recipient is kept in a safe, friendly environment. This differs from at-home care, as many adult day care providers operate brick-and-mortar centers where adult dependents will be cared for. Typically, adult day care centers have three main focuses: those that provide medical care, specialize in promoting social interaction, or those that focus on care for patients with Alzheimer's disease. A wide variety of activities, care services and health monitoring is available to give at-home caregivers peace of mind that their dependents are safe (Mayo Clinic).

According to the National Adult Day Services Association (NADSA) (SeniorLiving.org ), there are currently more than 5,600 adult day care centers throughout the U.S., which work to administer care to a population of more than 150,000 seniors. While staffing varies between centers, typically they feature social workers, activity staff, program assistants, nurses, directors and support staff.

When is adult day care reimbursement eligible?

Adult day care is eligible for reimbursement with a dependent care flexible spending account (DCFSA) if the adult is incapable of self-care and the expense allows the caregiver to work, look for work or go to school full-time. Qualifying individuals for DCFSAs must also live with you for at least half of the year and must either be a tax dependent or someone whom you could have claimed as a tax dependent.

The minimum and maximum amounts allowed to be contributed to a DCFSA are set by the employer, and the maximum set forth by the IRS is $5,000 for individuals or married couples filing jointly, or $2,500 for a married person filing separately. As opposed to Healthcare FSAs, expenses can only be reimbursed under a DCFSA after the expense has been incurred so funds accumulate throughout the year as opposed to being available in full on day one.

Specifically Not Covered

Not eligible with an FSA, Limited FSA, HRA or HSA.



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