Working Families Childcare Access (WFCA) Act

II 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 Representa- 1 tives of the United States of America in Congress assembled, 2 SECTION 1. SHORT TITLE. 3 This Act may be cited as the ‘‘Working Families 4 Childcare Access (WFCA) Act’’. 5 SEC. 2. EXPANSION OF BENEFITS FOR DEPENDENT CARE 6 ASSISTANCE PROGRAMS. 7 (a) EXPANSION OF ANNUAL MAXIMUM.— 8 (1) IN GENERAL.—Subparagraph (A) of Section 9 129(a)(2) of the Internal Revenue Code of 1986 is 10 VerDate Sep 11 2014 01:17 Jun 11, 2020 Jkt 099200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\S3765.IS S3765 pbinns on DSKJLVW7X2PROD with BILLS 2 •S 3765 IS amended by striking ‘‘$5,000 ($2,500’’ and inserting 1 ‘‘$15,000 ($7,500,’’. 2 (2) EFFECTIVE DATE.—The amendment made 3 by paragraph (1) shall apply to taxable years begin- 4 ning after December 31, 2020. 5 (b) CARRYFORWARD OF UNUSED BENEFITS UNDER 6 CAFETERIA PLANS.— 7 (1) IN GENERAL.—Section 125(d)(2) of the In- 8 ternal Revenue Code of 1986 is amended by adding 9 at the end the following new subparagraph: 10 ‘‘(E) CARRYFORWARD OF UNUSED BENE- 11 FITS UNDER DEPENDENT CARE ASSISTANCE 12 FLEXIBLE SPENDING ARRANGEMENTS.— 13 ‘‘(i) IN GENERAL.—Notwithstanding 14 subparagraph (A), a plan or arrangement 15 may permit a participant in a dependent 16 care assistance flexible spending arrange- 17 ment to elect to carry forward any aggre- 18 gate unused balances in the participant’s 19 accounts under such arrangement as of the 20 close of any year to the succeeding year. 21 Such carryforward shall be treated as hav- 22 ing occurred within 30 days of the close of 23 the year. 24 VerDate Sep 11 2014 01:17 Jun 11, 2020 Jkt 099200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\S3765.IS S3765 pbinns on DSKJLVW7X2PROD with BILLS 3 •S 3765 IS ‘‘(ii) LIMITATION.—The amount 1 which a participant may elect to carry for- 2 ward under clause (i) from any year shall 3 be any aggregate unused balances in the 4 participant’s account at the close of any 5 year. 6 ‘‘(iii) EXCLUSION FROM GROSS IN- 7 COME.—No amount shall be included in 8 gross income under this chapter by reason 9 of any carry forward under this subpara- 10 graph. 11 ‘‘(iv) COORDINATION LIMITS.—The 12 maximum amount which may be contrib- 13 uted to a dependent care assistance flexible 14 spending arrangement for any year to 15 which an unused amount is carried under 16 this subparagraph shall not be reduced by 17 such unused amount.’’. 18 (2) EFFECTIVE DATE.—The amendments made 19 by this subsection shall take effect on the date of the 20 enactment of this Act. 21 Æ VerDate Sep 11 2014 01:17 Jun 11, 2020 Jkt 099200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6301 E:\BILLS\S3765.IS S3765 pbinns on DSKJLVW7X2PROD with BILLS