Dependent care FSA limit 2026
For 2026 a household can set aside up to $7,500 a year in a dependent care FSA, or $3,750 for a married person filing separately. That's up from $5,000 and $2,500, the limits since 1986. The increase comes from the One Big Beautiful Bill Act signed on July 4, 2025, and the new limit isn't indexed for inflation.
The limits
| Filing status | 2025 | 2026 |
|---|---|---|
| Single, head of household, married filing jointly | $5,000 | $7,500 |
| Married filing separately | $2,500 | $3,750 |
The limit is per household, not per child or per parent. Two working parents with FSAs at different employers share one $7,500 limit. It also can't be more than the lower-earning spouse's income.
Is the new limit automatic?
No. The law allows up to $7,500, but each employer decides what its plan offers. Parents should check their 2026 plan and their election at open enrollment.
FSA and the child care credit
Parents can't use the same dollars twice. Whatever comes out of the FSA tax-free is subtracted from the expenses they can use for the child and dependent care credit, which counts up to $3,000 of expenses for one child or $6,000 for two or more. With a $7,500 FSA, a family with two kids has used up the credit's expense limit. The 2025 law also raised the credit percentage for many families from 2026, so a tax preparer can tell a family which mix is best.
What it means for your daycare
- More families will pay a larger share of tuition through an FSA, so expect more requests for receipts and signatures. See what providers give parents.
- Every receipt should show the dates of care, the amount, and your name and address.
- Parents will ask for your taxpayer ID; use an EIN so you don't have to hand out your SSN.
Paperwork for FSA families, done. Daycare Binder Pro sends this week's invoices to every family in one click, tracks payments and prints January statements for all families together. $12 a month.
Make a tax statementIs the dependent care FSA limit $7,500 per child?
No. It's per household per year, no matter how many children.
Does the $7,500 limit go up with inflation?
No. It stays at $7,500 until Congress changes it.
What can the FSA pay for?
Care for children under 13 while the parents work, such as home daycare, daycare centers, preschool and before- and after-school care. Overnight camp and kindergarten tuition don't count.
Sources: Internal Revenue Code § 129 as amended by Public Law 119-21 (One Big Beautiful Bill Act, July 4, 2025); IRS Publication 503. Checked October 31, 2026. General information, not tax advice.