Dependent Care Benefits


DEFINITION of 'Dependent Care Benefits'

Benefits provided by an employer to an employee for use in caring for dependents such as newborns or disabled persons. Dependent care benefits are part of the overall employee benefits plan and can be found in box 10 of the employee's W-2 form.

BREAKING DOWN 'Dependent Care Benefits'

Most employers will offer some level of benefits. For example, a company could provide a daycare center for employees or give time off to care for newly adopted children or dependent elderly persons.

The first $5,000 ($2,500 if your filing status is married filing separately) of dependent care benefits are tax-free. This also applies to pretax deferrals to a flexible spending account earmarked for dependent care.

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