Dependent Care Flexible Spending Account

Taking Care of Your Loved Ones

BWH℠ Hotels (BWH) offers a Dependent Care FSA administered by Discovery Benefits, so you can save money on your taxes when you have daycare expenses for your child or disabled adult family member who lives with you and is your tax dependent.

A Dependent Care FSA is an easy way to save money on your daycare expenses so you can continue to work. With an FSA, you don’t pay federal, state or FICA taxes on the money you contribute. This means you may save 15 to 46 cents on every dollar you spend on dependent care (your savings depends on your tax bracket).

Use your Dependent Care FSA to pay for:

  • Care for a child age 12 or younger so that you and your spouse can work, look for work, or go to school full-time
  • Care for a disabled spouse, elderly parent, or dependent of any age who:
    • Can’t care for himself/herself
    • Lives in your home at least eight hours a day
    • Is listed as your dependent on your income tax return
  • Child care provided in your home
  • After-school care for a child age 12 or younger
  • Nursery school or a day-care center
  • Summer day camp
  • The part of private school fees that are for the care of your dependent
  • Elder care for a parent.

How the Dependent Care FSA Works

It’s easy to enroll in a Dependent Care FSA. Just follow these simple steps:

  1. Estimate your out-of-pocket dependent care expenses for the coming year. You might want to budget for child care or the care of a dependent adult (such as an elderly or incapacitated dependent whom you claim on your tax return), nursery school or summer day camp, and/or a babysitter who cares for a dependent while you work.
  2. Elect to participate in the Dependent Care FSA during Open Enrollment.
  3. Determine how much to contribute to your FSA based on your estimate of dependent care expenses. You can contribute up to $5,000 of your annual before-tax pay. If you file federal income taxes as married filing separately, the IRS maximum is $2,500 per spouse.

Once enrolled, use the money in your Dependent Care FSA to pay eligible dependent care expenses throughout the plan year while you and your spouse (if you’re married) work or attend school full-time.

Re-Enrolling in the Dependent Care FSA

During Open Enrollment each year, you must re-enroll and elect the amount you wish to contribute to the Dependent Care FSA. Your elections do not carry over from one plan year to the next. You may only enroll in the Dependent Care FSA as a new employee or during Best Western’s Open Enrollment period. You cannot increase, decrease, or cancel your contributions to the Dependent Care FSA, unless you experience a Qualified Life Event or have a change in the cost of your day care expenses.

Use It or Lose It!

Please carefully think about the amount you wish to contribute to the Dependent Care FSA. The IRS requires that services must be performed during the plan year. Any money left in your account after the claim deadline is forfeited and cannot be rolled over to the next plan year. For more information, visit the IRS website at www.irs.gov/pub/irs-pdf/p503.pdf.

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