Example 1:
Annual Household Income: $24,700.00 Tax-Filing Status: Single Withholding Allowances: 1
| Without Flex | With Flex |
| Weekly Earnings | $475.00 | $475.00 |
| Medical Contribution | $0.00 | $10.00 |
| Taxable Wages | $475.00 | $465.00 |
| Taxes & Withholding | $114.52 | $111.39 |
| Net Take Home | $360.48 | $353.61 |
| Out-of-Pocket Medical Expenses | $10.00 | $0.00 |
| Spendable Income is | $350.48 | $353.61 |
| Weekly Savings | | $3.13 |
| Annual Extra Spendable Income | $3.13 X 52 Weeks = | $162.76 |
Example 2:
Annual Household Income: $45,000.00 Tax-Filing Status: Joint Withholding Allowances: 3
| Without Flex | With Flex |
| Weekly Earnings | $865.38 | $865.38 |
| Medical Contributions Dependent Contributions | $0.00 $0.00 | $25.00 $96.15 |
| Taxable Wages | $865.38 | $744.23 |
| Taxes & Withholding | $184.48 | $148.56 |
| Net Take Home | $680.90 | $595.67 |
| Out-of-Pocket Medical & Dependent Care Expenses | 121.15 | |
| Spendable Income is | 559.75 | $595.67 |
| Weekly Savings | | $35.92 |
| Annual Extra Spendable Income | $35.92 X 52 Weeks = | $1,867.84 |
* These are examples only. Please consult your tax advisor to estimate your own tax savings.
Many households with earnings of $40,000 or more find the Dependent Care Assistance Account more advantageous than the tax credit. GDI urges you to consult with your tax advisor.
