What is the maximum amount I can elect to set aside for Work-Related Dependent Care expenses?

$5,000 is the maximum if you are single or married and filing a joint tax return. $2,500 is the maximum if you are married and filing separate returns. However, your contribution may not exceed your earned income, nor your spouse’s earned income. This maximum is per family, per calendar year.

The spouse of a married employee is deemed to be gainfully employed and to have an earned income of not less than $250 per month ($500 per month if there are two or more qualifying individuals) in each month during which he or she: (a) is a full-time student; or (b) is incapable of self-care and has the same principal place of abode as the employee for more than half the year.

In the situation of divorce, only the Custodial parent may use this account.