Family Savings for Kids and Seniors Act would allow families to set aside more pre-tax income for dependent care
U.S. Representatives Jaime Herrera Beutler (R-WA) and Katie Porter (D-CA) introduced legislation late last week to address the skyrocketing cost of childcare. Their bipartisan Family Savings for Kids and Seniors Act would more than double the amount of money families can set aside pre-tax in Dependent Care Flexible Spending Accounts (FSAs) to help pay for preschool, summer day camp, before or after school programs, and child or adult daycare.
“Caring for a child or an aging parent costs a significant amount of money, and can be a heavy load for working families to carry,” Herrera Beutler said. “I’m proud to join this bipartisan effort to offer families in Southwest Washington the ability to save money as they care for their kids and other dependent relatives. This legislation would increase the tax-free amount that families can set aside for expenses like child care, after-school programs, or adult care services. I’ll continue to work on commonsense measures like this that allow working families to keep more of their hard-earned money.”
“As a single mom, I know firsthand that we have a childcare crisis in this country,” Porter said.“My constituents in the 45th Congressional District have asked me to help them make childcare more affordable. My bill offers families a way to keep more of what they earn to pay for the childcare and elder care that allows them to work, and the work that parents do adds to the vitality and strength of our economy. I hope my colleagues will join me in supporting America’s working families.”
Under current law, families can put up to $5000 of pre-tax income into Dependent Care FSAs. This limit has not been changed since 1986. The Family Savings for Kids and Seniors Act would adjust this limit to account for inflation. If this legislation had been enacted for 2019, families could have set aside $11,300 of pre-tax income to pay for dependent care.
This is part of Herrera Beutler’s multi-pronged effort to increase available access to childcare for all families across all income levels and needs. The FSA-expansion approach is targeted at helping families who may be struggling with the rising costs of childcare or other dependent care, but who may not currently qualify for certain federal aid programs or childcare subsidies. Herrera Beutler believes Congress should be enacting solutions that help mothers, fathers and other caregivers be able to afford care regardless of income level or location.
Last month, Herrera Beutler introduced another bipartisan bill to make affordable child care more accessible for Southwest Washington families living in rural areas. The bill helps address the critical problem of “child care deserts.”