Walorski bill offers expanded tax benefits for childcare

U.S. Rep. Jackie Walorski (R-IN) on June 30 sponsored legislation that would expand tax benefits for dependent care assistance programs, thereby providing parents with more flexibility to pay for childcare.

“Hoosier workers and families are facing unprecedented challenges amid the coronavirus pandemic, and access to childcare is among parents’ biggest concerns,” the congresswoman said.

Rep. Walorski introduced the Working Families Childcare Access Act, H.R. 7436, which would permit parents to contribute more to their employer-sponsored dependent care flexible spending account (FSA).

“As we work to safely reopen and rebuild our economy, we need to find commonsense solutions that empower working families and help them thrive,” said Rep. Walorski. “Giving parents more flexibility to save their hard-earned money for critical childcare expenses will make it easier for them to navigate these uncertain times.”

The dependent care FSA benefit allows pretax dollars to be used to pay for dependent care services, which includes expenses for preschool, summer day camp, before- or after-school programs, and child or adult daycare. Currently, annual contributions are limited to $5,000, and any unused funds are forfeited at the end of the year, according to information provided by Rep. Walorski’s office.

If enacted, H.R. 7436 would allow parents to contribute up to $15,000 per year to their employer-sponsored dependent care FSA, and to roll over remaining funds to the following year without penalty, according to the information.

The measure has been referred for consideration to the U.S. House Ways and Means Committee.