United States dependent care FSA and care credit 2026
United States dependent care assistance and the Child and Dependent Care Credit have separate federal limits and interact when benefits are excluded.
On this page
- 2026 dependent care FSA limit
- $7,500; $3,750 if married filing separatelyIRS, Publication 15-B (2026)
- 2026 maximum care credit rate
- 50% of qualifying expensesIRS, Publication 505 (2026)
- Credit expense ceiling
- $3,000 for one; $6,000 for two or more qualifying individualsIRS, Child and Dependent Care Credit
Dependent care assistance exclusion
IRS Publication 15-B for 2026 states an annual dependent care FSA limit of $7,500, or $3,750 for married filing separately. Benefits under a dependent care assistance program are generally excludable up to these limits. The exclusion is also limited by the employee’s earned income or, for a married employee, the lower of the employee’s and spouse’s earned income. IRS, Publication 15-B (2026) (opens in a new tab).
The 2026 care credit change
IRS Publication 505 for 2026 states that the maximum credit rate for qualifying child and dependent care expenses increases to 50%. IRS, Publication 505 (2026) (opens in a new tab).
Qualifying care and expenses
The Child and Dependent Care Credit covers qualifying care expenses that enable work or an active search for work. Qualifying individuals include a dependent child under 13 when care was provided and certain individuals incapable of self-care. The expense ceiling is $3,000 for one qualifying individual or $6,000 for two or more. IRS, Child and Dependent Care Credit (opens in a new tab).
Coordination with excluded benefits
Dependent care benefits excluded or deducted from income reduce the applicable credit expense ceiling. Qualifying care expenses are also reduced by employer dependent care benefits excluded from gross income. IRS, Child and Dependent Care Credit (opens in a new tab).
Scope
This guide describes the published federal exclusion and credit framework. It does not calculate a claim, a plan election or an individual credit rate, and excludes state tax treatment. General information only, not personalised tax advice.