10/12/2026
Wisconsin parents: here’s a heads-up about your Dependent Care FSA. 👨👩👧
Maybe you set aside more than $5,000 this year for daycare, preschool or summer camp. If so, the amount over $5,000 is still tax-free on your federal return. But it counts as taxable income in Wisconsin.
If you elected the full $7,500, that’s $2,500 of Wisconsin-taxable income. Depending on your bracket, that’s roughly $110 to $190 in additional state tax.
The good news: for most people, the federal income tax and F**A savings on that extra $2,500 generally outweigh the Wisconsin tax. The key is knowing it’s coming, so tax season holds no surprises.
✔️ Check your year-end paystub and W-2
✔️ Plan for the state tax difference
✔️ Questions? Talk with your tax professional
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