I would like to know which would be more beneficial to me... a dependent care fsa or claiming daycare expenses on my taxes at the end of the year. My annual income should be about 31000 and daycare is $135 a week. So for the remainder of the year I will incurr expenses 5,400 in daycare costs and if I were to elect an fsa I would probably elect 4,000 since it is a use it or loose it plan. I am very unfamiliar with any of these kind of things! Would I get more benefit from the dca or getting the child tax... which leads me to another question... is the child tax and earned income the same thing? If not does that mean I will still get something back on my return if I have the dca from claiming a dependent>? Advice would greatly be appreciated... thanks a lot!!

The Childcare Tax Credit is capped at $600.

You are being taxed at 15% with a $4,000 FSA election.

15% of $4,000 is $600.

So it's a wash; either way is okay.