Working Families Childcare Access (WFCA) Act

Working Families Childcare Access (WFCA) Act

This bill increases to $15,000 the maximum amount of dependent care assistance that may be excluded from the gross income of an employee receiving such assistance. It also permits a carryforward to a succeeding year of unused balances in a dependent care assistance flexible spending arrangement.

[Congressional Bills 116th Congress]
[From the U.S. Government Publishing Office]
[S. 3765 Introduced in Senate (IS)]

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116th CONGRESS
  2d Session
                                S. 3765

   To amend the Internal Revenue Code of 1986 to expand tax benefits 
             related to dependent care assistance programs.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                              May 19, 2020

 Mrs. Loeffler introduced the following bill; which was read twice and 
                  referred to the Committee on Finance

_______________________________________________________________________

                                 A BILL


 
   To amend the Internal Revenue Code of 1986 to expand tax benefits 
             related to dependent care assistance programs.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Working Families Childcare Access 
(WFCA) Act''.

SEC. 2. EXPANSION OF BENEFITS FOR DEPENDENT CARE ASSISTANCE PROGRAMS.

    (a) Expansion of Annual Maximum.--
            (1) In general.--Subparagraph (A) of Section 129(a)(2) of 
        the Internal Revenue Code of 1986 is amended by striking 
        ``$5,000 ($2,500'' and inserting ``$15,000 ($7,500,''.
            (2) Effective date.--The amendment made by paragraph (1) 
        shall apply to taxable years beginning after December 31, 2020.
    (b) Carryforward of Unused Benefits Under Cafeteria Plans.--
            (1) In general.--Section 125(d)(2) of the Internal Revenue 
        Code of 1986 is amended by adding at the end the following new 
        subparagraph:
                    ``(E) Carryforward of unused benefits under 
                dependent care assistance flexible spending 
                arrangements.--
                            ``(i) In general.--Notwithstanding 
                        subparagraph (A), a plan or arrangement may 
                        permit a participant in a dependent care 
                        assistance flexible spending arrangement to 
                        elect to carry forward any aggregate unused 
                        balances in the participant's accounts under 
                        such arrangement as of the close of any year to 
                        the succeeding year. Such carryforward shall be 
                        treated as having occurred within 30 days of 
                        the close of the year.
                            ``(ii) Limitation.--The amount which a 
                        participant may elect to carry forward under 
                        clause (i) from any year shall be any aggregate 
                        unused balances in the participant's account at 
                        the close of any year.
                            ``(iii) Exclusion from gross income.--No 
                        amount shall be included in gross income under 
                        this chapter by reason of any carry forward 
                        under this subparagraph.
                            ``(iv) Coordination limits.--The maximum 
                        amount which may be contributed to a dependent 
                        care assistance flexible spending arrangement 
                        for any year to which an unused amount is 
                        carried under this subparagraph shall not be 
                        reduced by such unused amount.''.
            (2) Effective date.--The amendments made by this subsection 
        shall take effect on the date of the enactment of this Act.
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