Conference nyoss1::market_investing

    DEC has this, too, and calls it DCRA (Dependent Children 
    Reimbursement Account).  You can pay with pre-tax dollars
    and still deduct any extra post-tax money you spend.
    
    But it's tricky--we use an accountant and keep copious
    records.
    
    		-John Bishop

	If both of you are use the pre-tax deductions, you can at most deduct
	$5000 together per year. Digital limits the DCRA deductions to $96
	per paycheck.

	DCRA could be better than claiming the deduction at the end of the 
	year, since the child care expense (form 2102, I think) allows at most
	20%; with DCRA, you can get upto your tax bracket.

	If you anticipate your child care expenses to exceed $5000, go for the
	maximum paycheck deduction. The recordkeeping is not that bad. I just
	type out monthly statements, have them signed by our care provider,
	and send the statements to John Hancock (that administers the program
	at Digital) to get the check next month. For expenses over $5000, 
	some more deduction on filing 2102. 

re: <<< Note 573.1 by TLE::JBISHOP >>>
>>    You can pay with pre-tax dollars
>>    and still deduct any extra post-tax money you spend.
    
    Are you sure you can do both of these?   I thought it was either/or.
    For example, say you have $9000 in child care expenses.  The limit
    on the DCRA is $5000/year.  So you can pay for $5000 with pre-tax
    dollars. You're saying that the remaining $4000 is tax deductible?
    I thought it wasn't.

    Marc

    re .3
    
    It was once--whether this is still true I don't know.  I'll
    find out at tax time in '94, when I spend my morning with
    the accountant.
    			-John Bishop

    Nope, it's not.  I checked into this for our '92 return.  If you hit the
    maximum number with your pretax deductions and still have extra daycare
    expenses then you can't deduct that extra from your taxes.  However, if
    your DCRA was for only $3000 but you had $6000 in daycare expenses you
    can deduct the difference between the maximum allowable deduction and
    the $3000 that you had in DCRA (it won't amount to much since you get
    back a percentage of it based upon your income).
    
    Also note that the pretax deductions and the maximum you can deduct
    from your taxes (if you don't use DCRA) are PER FAMILY NOT PER CHILD.
    
    Susan

    
    
    re .2
    
    
            DCRA could be better than claiming the deduction at the end of
    the year, since the child care expense (form 2102, I think) allows
    at most 20%; with DCRA, you can get upto your tax bracket.
    
    
    
    Can you elaborate, maybe with a example.
    I really did not think it would make any difference except that you
    would have to wait till Taxtime to get your money.
    Has anybody calculated this both ways ?
    
    
    Our DCRA deductions will be LESS than $5000.
    
    
     
    

    I'd have to dig up the numbers, but, the $5K pre-tax deduction can be a
    much better deal since you only get to claim a portion of your actual
    expenses based on your income if you don't use the pre-tax plan. 
    
    I calculated it both ways the last two years (even tho' it was too late
    since I used the Pre-tax deduction during the year), and it was
    substantially better to use the employer sponsered pre-tax deduction.
    
    Just take a look at last year's tax booklet and it explains the formula
    used to calculate the deduction if you didn't use the pre-tax plan. 
    
    It really comes down to your income and the percentage you can take off
    the bottom line (tax line that is). For us, the pre-tax deduction was a
    much better deal.
    
    Marie

	re. .6

	.7 answers your question. 

	Basically, if you do not use DCRA, (or, your DCRA deductions are 
	less than 5K, and your childcare expenses are more than the deductions)
	the amount by which you can decrease your income is based on the 
	family income. If you are in the 28% bracket, chances are very high
	that you will not be able to take 28% of your unclaimed expenses
	in form 2102, but more like 20% at the most. 

    
    Well folks, I decided to try it out and signed up for DCRA.
    
    I asked the personal person if alot of folks signed up ?
    
    SHe said approx. 20 people in about 2000 to talk to SHR site.
    I find it strange that only 1% have signed up ???
    
    She even said  to me that if youy want to re-think signing up that
    to come back in a few days with a decision.  I signed up though.
    It sounded like she didn't think it was worth it ???
    
    
    Weird or what.

    
    I spoke directly with John Hancock who adminsters the plan since I
    signed up for DCRA last month, with most of the tax year behind us.
    
    I wanted to be sure that because I signed up that I could still claim
    the post-tax dollars I used from daycare previous to signing up, they said
    I could claim those too.....
    
    Is that what 573.2 meant by saying "For expenses over $5000,
            some more deduction on filing 2102."