Dependent care reimbursement accounts (DCRAs)

With a DCRA, employees are able to make pre-tax payroll contributions to pay for dependent care expenses. To qualify, the dependent care must be essential for the employee and a spouse (if applicable) to work, look for work or attend school full-time.

The maximum annual DCRA contribution allowed is $5,000 per household. Unlike medical flexible spending accounts, annual DCRA funds are not available up front. Funds are only accessible as they are deposited with each payroll deduction.

Employees pay for dependent care costs out-of-pocket then submit documentation for reimbursement through the HealthEquity member portal.

HealthEquity and DCRAs

Managing benefits for a business can be complex. A single business may have relationships with many different vendors in order to offer a wide-range of benefits to its employees. That’s why HealthEquity offers dependent care reimbursement accounts as part of our comprehensive benefits package. Make managing your businesses benefits easier by partnering with HealthEquity for DCRAs in addition to your health savings accounts (HSA), 401(K)s and more.

DCRA features

Use it or lose it

DCRA funds do not roll over from year to year. Employees must use DCRA dollars within the plan year or they will be forfeited.

Qualified dependents

To be considered qualified, dependents must meet one of the following criteria:

  • Children under the age of 13
  • A spouse who is physically or mentally unable to care for him/herself
  • Any adult you can claim as a dependent on your tax return that is physically or mentally unable to care for him/herself

Eligible expenses

  • Babysitter inside or outside household
  • Before and after school or extended day programs
  • Custodial childcare or eldercare expenses
  • Day camps
  • Daycare centers
  • Household employee whose services include care of a qualifying person
  • Late pick-up fees
  • Looking for work-expenses
  • Nanny expenses
  • Preschool/nursery school for pre-kindergarten
  • Sick-child care center
  • Summer day camps

Ineligible expenses

  • Educational/tuition expenses
  • Expenses paid to child of participant
  • Field trip expenses
  • Food, clothing, education or entertainment expenses
  • Household services
  • Household employee whose services include care of a qualifying person
  • Incidental expenses
  • Overnight camp
  • Payments for care where you are not the custodial parent
  • Payments for care while on a leave of absence, maternity or other medical leave
  • Payments for care while you are on vacation or due to illness
  • Payment for services not yet provided
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