2014 Benefits Open Enrollment
Dependent Care Spending Account
Instructions and Information for
Completing Your Personal
These instructions will assist you in completing
your Personal Enrollment for The University of Iowa Benefits Program.
A Dependent Care Spending Account allows you to arrange for a
portion of your earnings, not to exceed $5,000.00 per year, to be deposited into
a special account that is then used to reimburse you for dependent care expenses
incurred during the year for the custodial care of children or other eligible
dependents. IRS regulations provide that earnings allocated to a Spending
Account are not subject to federal income taxes, state income taxes, or FICA
taxes. If you elect to participate in this plan you are reimbursed for these
expenses with income that is not subject to these taxes. Your deposit is limited
by your tax filing status. If you file your Federal taxes as married filing
separately, you may deposit up to a maximum of $208.33 monthly. All other tax
filing statuses may deposit up to a maximum of $416.66 monthly. The combined
maximum that a couple may contribute to this account is also $416.66 per
Services must be incurred during the current year of
participation. Funds that are not claimed for eligible dependent care expenses
by the following April revert to the University and may not be claimed by the
individual. When an individual terminates, all services and expenses must be
incurred by the end of the calendar year in which the termination occurs and
must be claimed by the following April. Any funds not spent by this date will be
Last year's contribution amounts will automatically carry over for 2014. As you examine your 2014 online enrollment, please remember that your
2013 annual spending account pledge amount carries over; the 2013 annual amount (divided by 12) is inserted in
the 2014 pledge area(s) by default.
If you want to see the cost of your benefit selections before deciding on a
spending account pledge amount(s), simply enter "0" in the 2014 spending account
pledge area(s) and then choose the "recalculate" function/button. You can use
this function multiple times to experiment with different choices and spending
account(s) pledge amounts.
EXPENSES THAT CAN BE PAID BY A DEPENDENT CARE SPENDING
This account may be used to pay for certain expenses connected
with the custodial care of children under the age of 13 years who are claimed as
an exemption on the employee’s federal income tax return. It may also be used
for reimbursing costs for the care of other eligible dependents such as a
disabled spouse or dependent parents.
In order to participate, both the eligible employee and spouse
must work or be a full-time student. The expenses must be for the following
types of dependent care provided during working hours:
The account cannot be used to make payments to an eligible
employee’s spouse, to an eligible employee’s child who is under the age of 19
years, or to any person whom the eligible employee claims as a dependent on an
income tax return. Any expenses associated with kindergarten or overnight camps
may not be used.
You may decide each year during the annual enrollment
period whether or not you wish to participate in these plans. If you do not sign
up during the annual enrollment, you will not be able to participate during the
following year, unless you have a qualifying change in status.
During any one year, once you elect to participate and
designate the amount to be deposited into your spending accounts, you may not
stop deposits nor change the amount deposited into your account unless you have
a qualifying event. A change in your account must be made within 30 days of the
event; otherwise you must wait until the next annual enrollment period.
You do not pay FICA, or Federal and State income taxes on
flexible spending account contributions.
The tax deductibility of dependent care expenses goes down
as income goes up. By participating in the flexible spending account, you have
the advantage of avoiding the taxes regardless of income.
While dependent care expenses are tax deductible up to
certain levels, participating in the spending account may also let you avoid the
7.65% FICA tax.
If you are contributing the maximum monthly amount to the
spending account, the annual savings to you by avoiding the FICA tax will be
There may be some disadvantages to using these accounts:
Deposits to such an account may reduce your Social Security
wage base, and consequently, your Social Security tax contributions may be
Once you decide to participate in this plan for any given
year and designate the amount to be deposited in such an account, you cannot
change this decision. The University must continue to deposit the specified
amount into your account. Furthermore, any amount which is not expended for
eligible expenses incurred during the calendar year by December 31 of that year,
and claimed by April 30 of the next year revert to the University.
You may request reimbursements weekly, monthly, semi annually,
or annually, whichever is the most convenient for you. Expenses submitted must
have incurred after your first payroll deduction under this program. Request for
Reimbursement forms submitted to the Benefits Office by Thursday at 5:00 p.m.
will generally be paid the following week. The actual day when the payment is
made could vary depending on the presence of holidays. Payment is made directly
to the checking or savings account where your monthly pay is deposited.
Reimbursement forms are available on the Benefits web site. You may file
for reimbursement at any time during the year, but no later than the last
business day of April of the following year.
In order to comply with IRS regulations, dependent
care expenses cannot be reimbursed until after the service has been provided.
Top of Page
If you have questions or concerns regarding the enrollment process, please
Web Site: www.uiowa.edu/hr/benefits
Phone: 319-335-2676 or