The Dependent Care Assistance Program (DCAP) can help you reduce taxable income by setting aside money from each paycheck—before taxes—to pay for dependent care expenses. This benefit is only offered to PEBB benefits-eligible state and higher-education employees.
How the DCAP can help you
- Setting aside a portion of your pay in DCAP reduces your annual taxable income and helps you pay for out-of-pocket dependent care expenses.
- DCAP reimburses qualified dependent care expenses so you and your spouse (if married) can attend school, work, or look for work. If you have a stay-at-home spouse, you cannot enroll in the DCAP.
- Eligible expenses include babysitting, daycare, prekindergarten, and registration fees (see full list of eligible expenses)
Qualifying dependents include:
- A dependent under age 13 who qualifies as an Internal Revenue Service (IRS) dependent.
- A spouse who is physically or mentally incapable of self-care.
- Any other IRS-recognized dependent who is physically and/or mentally incapable of self-care.
Enrolling in DCAP
You can set up a DCAP account:
- When you become eligible for PEBB benefits. You must enroll no later than 31 days after you become eligible (usually on your first day of employment).
- During the PEBB annual open enrollment.
- During the plan year if you or an eligible family member has a qualifying event that creates a special open enrollment. You must enroll no later than 60 days after the event that created the special open enrollment.
You decide how much you want to set aside when you enroll. Maximum annual amount: $5,000 ($2,500 if you and your spouse file separate tax returns)
Using your DCAP funds
Eligible expenses can begin on or after the first day of your plan year January 1. You can only be reimbursed up to the dollar amount you have in your DCAP account at the time you request reimbursement. You may submit a claim form
as frequently as you prefer, but you cannot submit claims for services until after they have been provided.
Under federal law, ASIFlex must receive your claims no later than March 31. If you don't file claims by that date, your account will be closed and any balance remaining will be forfeited to the Washington State Health Care Authority (HCA). Once the money is forfeited, you will not be able to claim it.
The PEBB Program's Dependent Care Assistance Program is administered by:
- ASIFlex (2013)
- Flex-Plan Services (2014)