Dependent Care FSA Limit Is $7,500 Now: How Much to Elect for 2027

The dependent care FSA limit is $7,500 per household for 2026, or $3,750 if you are married and file separately. It used to be $5,000, a number that had stayed the same for decades. The IRS confirms the new amount in Publication 15-B for 2026. The law sets it as a flat dollar amount rather than one adjusted for inflation each year, so it stays $7,500 for 2027 unless Congress changes it. Your plan's enrollment guide shows the number it uses. In November the harder question is your own number: how much care you will actually pay for next year, and which receipts you will need to get the money back.

What changed, and what did not

A dependent care FSA, which the IRS calls a dependent care assistance program, lets you pay for child care with money taken from your paycheck before tax. In 2026 the limit went up, and most of the rules stayed the same.

The limit is per household, not per parent. If you and a spouse both have a dependent care FSA at work, your two elections together count against the same $7,500. Publication 15-B also caps the tax-free amount at the lower of your earned income and your spouse's.

What the money can pay for

IRS Publication 503 sets out which costs count as care. The ones parents usually budget for:

• Daycare and preschool. Nursery school and preschool count as care, even when they include lunch and some teaching.
• Before and after school care. For a child in kindergarten or older, the school tuition does not count, but care before and after school can.
• Summer day camp. A day camp can count, even one built around a single activity like soccer or coding.
• A babysitter or nanny who looks after your child so you can work.

What does not count: overnight camp, summer school and tutoring, and kindergarten or school tuition itself. Your plan administrator has the final list, so check it before you build your number around one big expense.

How much to elect for 2027

Treat the limit as a ceiling. Elect the amount you are confident you will spend, because money left in a dependent care FSA at the end of the plan year is generally lost. Some plans add a grace period of up to two and a half months to use it; the carryover that some health FSAs allow does not apply to dependent care. Your plan documents say which rules you have.

A simple way to get to your number:

1. Add up the care you already pay for. Monthly after-school or daycare invoices, times the months you expect to use them in 2027.
2. Add the summer. Day camp weeks you are fairly sure of. Many camps publish prices in winter, so last year's invoice is a fair guide.
3. Take out what might change. A child turning 13 during the year, a move to a free program, a parent leaving work. Care for a child stops counting once they turn 13.
4. Cap it at $7,500, minus anything your spouse elects at their job.

If your yearly care costs are well above $7,500, which is common with full-time daycare, electing the full amount is usually the easy call. The care will use it.

This is general information from IRS publications, not tax advice. The child and dependent care tax credit uses the same expenses, and the money you take from the FSA reduces what you can claim there. If the choice between them matters for you, a tax preparer can run both.

The receipts to keep

Usually you pay the daycare first, then claim the money back from the plan with proof. Two things trip parents up: claims sent in bunches months later, and paperwork missing the details the plan needs.

For each claim, keep:

• The provider's name, address and taxpayer identification number. You also need these on your tax return, according to Publication 503. A home babysitter gives a Social Security number; a center gives its employer ID.
• Dates of care. Plans generally pay back care once it has been given, not care paid months ahead.
• The child's name and the amount.
• For camp, proof that it was a day camp. A camp invoice with dates usually covers it.

Ask the daycare or after-school program for a yearly statement in January, and the summer camp for one in September. Then check your plan's claims deadline for the 2027 plan year, which often falls a few months after it ends.

Where Tracy fits

Tracy, the assistant in dEssence, does not pick your election, file claims or log in to your benefits portal. She keeps what you send her and comes back when it needs you.

At open enrollment, paste in the HR email or send a screenshot, and she notes the deadline. Through the year, send a photo of each daycare, after-school or camp invoice from Telegram, Chrome or the web. She keeps the amount and dates and reminds you to claim. If you also have a health FSA, its spend-down dates are in our guide to the FSA deadline. Camp sign-up days are a separate set of dates, covered in summer camp registration.

Frequently asked questions

What is the dependent care FSA limit for 2026?

$7,500 per household, or $3,750 if you are married filing separately, according to IRS Publication 15-B for 2026. Before 2026 it was $5,000.

Is the dependent care FSA limit $7,500 for 2027?

Yes, unless Congress changes it. The law sets a flat amount that is not adjusted for inflation each year. Your employer's enrollment materials show the figure your plan uses.

Can both spouses put $7,500 in a dependent care FSA?

No. The limit is per household. Two elections together count against the same $7,500.

Does summer camp count for a dependent care FSA?

Day camp can count, even a specialty camp. Overnight camp does not, according to IRS Publication 503.

What happens to money I do not use?

It is generally lost at the end of the plan year. Some plans allow a grace period of up to two and a half months. Your plan documents say which rules apply.

Related reading

• FSA Deadline 2026: What to Check Before Your Flexible Spending Account Money Expires
• How to Keep Track of Summer Camp Registration Dates
• Winter Break Camp Registration: When It Opens and How Not to Miss the Day
• Renewal Dates to Keep Track Of: The Ones Nobody Mails You a Letter About