Dependent care benefit over 5000 in W2 does not flow to Form 2441 accurately

[Ellen Knous Cole]

When the W2 box 10 has an amount over 5000 (say 8000), it does not flow correctly to line 12 of the Form 2441 (Proseries enters an amount of 5000), resulting in no taxable benefit listed on 26 of Form 2441 or line 1e of Form 1040, therefore incorrectly understating taxable income. The way to currently correct for this is to override line 12 of the 2441, but would be best if Proseries could fix this functionality defect.

[George4Tacks]

Investigate the possibility that the W-2 is WRONG! Maximum amount on W-2 is $5,000.

See the 2nd item at https://www.irs.gov/faqs/childcare-credit-other-credits/child-and-dependent-care-credit-flexible-ben...

[Ellen Knous Cole]

yes, we realize the employer should not have funded more than 5000 to the employee, but they did so. that is why the excess is taxable to the employee on their 1040. this is a rare occurrence, since the employer should not be giving more than 5000, but I wanted others to be aware of the Proseries defect, in case anyone else should happen to have this situation. Proseries does handle it correctly if there the total from 2 different W2s goes over 5000 (which I've also seen, where 2 spouses are covered and not realizing they went over 5000 collectively).

[George4Tacks]

When it is over $5,000 - Where does the extra end up?

$5,000 is the maximum that can go on the 2441. When in doubt - READ THE DIRECTIONS

Line 12

Enter the total amount of dependent care benefits you received in 2024. Amounts you received as an employee should be shown in box 10 of your Form(s) W-2; however, don’t include amounts reported in box 10 that exceed your plan's exclusion and are therefore reported as wages in box 1 of Form(s) W-2. If you were self-employed or a partner, include amounts you received under a dependent care assistance program from your sole proprietorship or partnership