jkjsooner
8/25/2011, 09:38 AM
Okay, first I must say that I'm an idiot. I'm sure you guys knew that already... :friendly_wink:
My wife is enrolled in a childcare flex spending account. They take out $5000 a year pre-tax from her paycheck and she gets reimbursed when we submit receipts for childcare.
The medical flex plans (we both use one) work in a similar way. I figured they were pretty much the same. For the medical plans that's pretty much that. The money withheld does not show up on your W2 and you don't pay taxes for it. (I believe you might claim it somewhere but it doesn't get added to taxable income.)
I used Turbo Tax and imported our W2's. I didn't realize that line 10 of her W2 has the pre-tax money in it and that that gets added to your income. You then have to add in childcare expenses to get that essentially removed as taxable income. I didn't do this because this isn't necessary with the medical flex plans. (Afterall, both types of plans validate expenses prior to reimbursement.)
It appears that I had $4100 (she didn't work the full year at that employer so we didn't get $5000 taken out) too much added to my taxable income. Have you guys done this and does that make sense?
The only reason I realized this is because we're buying a house and the bank was trying to figure out where the $4100 came from.
One other question, does the IRS care about the exact amount or, since the expense was well over $5000 (more like $14k) can I just throw out a number that exceeds $5k with the EID of the childcare center. Will they have a problem if the childcare center states I had $14k when I stated I had $8k?
My wife is enrolled in a childcare flex spending account. They take out $5000 a year pre-tax from her paycheck and she gets reimbursed when we submit receipts for childcare.
The medical flex plans (we both use one) work in a similar way. I figured they were pretty much the same. For the medical plans that's pretty much that. The money withheld does not show up on your W2 and you don't pay taxes for it. (I believe you might claim it somewhere but it doesn't get added to taxable income.)
I used Turbo Tax and imported our W2's. I didn't realize that line 10 of her W2 has the pre-tax money in it and that that gets added to your income. You then have to add in childcare expenses to get that essentially removed as taxable income. I didn't do this because this isn't necessary with the medical flex plans. (Afterall, both types of plans validate expenses prior to reimbursement.)
It appears that I had $4100 (she didn't work the full year at that employer so we didn't get $5000 taken out) too much added to my taxable income. Have you guys done this and does that make sense?
The only reason I realized this is because we're buying a house and the bank was trying to figure out where the $4100 came from.
One other question, does the IRS care about the exact amount or, since the expense was well over $5000 (more like $14k) can I just throw out a number that exceeds $5k with the EID of the childcare center. Will they have a problem if the childcare center states I had $14k when I stated I had $8k?