FSA's and divorced parents

[Guest ADP]

I'm trying to find out the maximum amount divorced parents can claim on an FSA - is it $2500 or $5000 each?

Additional information includes:

- parents are both custodial

- each parent claims one child on their taxes

- there is nothing written in their child support agreement

that states CS is covering heath or dependent care.

Our TPA wasn't sure. Any help would be appreciated.

[SLuskin]

One parent has to have custody more days in a year than the other one. That parent would get the full $5000. I could see how, if there are 2 children, and Mom has 1 child more days in the year and Dad has the other more days in the year, and all daycare is truly employment-related, that they could each get up to $5000. Dad couldn't be remarried to a stay-at-home spouse and still get the deduction.

Married filing separately is $2500.

[papogi]

I agree with SLuskin's response. I wanted to add and reiterate that, in the case of divorced or separated parents, it usually does not matter who claims the dependent exemption. For purposes of the Child Care Credit and DCFSA's, the custodial parent is the one who had costody longer than the other parent. That makes it pretty bad if you are the parent who had custody just a little less than the other parent, but that's how the IRS writes it.