Federal Tax Credit Or DCAAccount?
We encourage you to use the online calculator to help you decide whether to use the Federal and State Tax Credits or the DCAAccount, or a combination of both to maximize your savings. As a result of the Economic Growth and Tax Relief Reconciliation Act of 2001 (EGTRRA), effective in January 2003, the IRS raised the maximum allowable expenses for the Federal Tax Credit from $2,400 to $3,000 for one qualifying dependent and from $4,800 to $6,000 for two or more dependents. These and other changes in the federal tax law may affect your potential DCAAccount savings. Your decision will depend on a number of factors such as your tax filing status (e.g., married, single, head of household), number of qualifying dependents, amount of dependent care expenses, earned income, etc. If your family qualifies for the Federal Earned Income Tax Credit (EITC), participation in the DCAAccount, the HCSAccount, or both, may increase your EITC to your advantage. Consult your tax advisor or the IRS for addit
