In the new year, questions remain over the future of President Joe Biden’s massive “Build Back Better” plan. While Democrats were hopeful that the bill would pass, West Virginia Sen. Joe Manchin poured cold water on their hopes and said that his fellow Democrats should fundamentally rethink their approach.

What does this mean for families?

The bulk of the Biden administration’s hopes for lessening the financial burden on parents was centered around the “Build Back Better” Act. Advocates of the bill touted its contribution to household budgets across the country and across the economic divide. As NBC reported, “The act includes provisions, ranging from paid leave to funding for universal pre-K, that would be especially beneficial to low- and middle-income households,” according to Kris Cox, deputy director of federal tax policy at the Center on Budget and Policy Priorities.

None of these initiatives appear likely to materialize anytime soon. 

What could lawmakers and the Biden administration do to help families in the meantime? One easy legislative move that would significantly help middle-class budgets is a tweak of IRS regulations to allow more Americans to put aside pre-tax money from their paychecks in order to pay for child care expenses like day care, preschool or summer camp. 

Last year’s American Rescue Plan Act raised pre-tax contribution limits for dependent care flexible spending accounts for the calendar year 2021, in addition to increasing the value of the dependent care tax credit for 2021.

In just the year 2021, the annual limits for pretax contributions increased to $10,500 (up from $5,000) for single taxpayers and married couples filing jointly, and to $5,250 (up from $2,500) for married individuals filing separately. At the end of 2021, the limits automatically reverted back to $5,000. That slide back to a $5,000 limit was painful for a number of middle-class American families.

Last year Shannon Ford, Mrs. Universe 2021 and a mother in Florida, used a dependent care savings account for her son. She told me, “It basically allowed us to budget for his day care/preschool without much thought. If the lower amount had been in place, I think it would have been more challenging. We hit $10,000 easily with one child. But setting it aside allowed us to save more.” 

With inflation, parents around the country are feeling the pinch. The $5,000 limit is only going to help Erin, the California mother of an infant daughter, for about four months. After that, saving for day care becomes a great deal more difficult and complicated. It’s part of her family’s calculus to move from California to a place with a lower cost of living, to allow the $5,000 to stretch farther. 

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With the state of the economy and the pressures put on parents by COVID-19, the financial stress is breaking some families. Marilyn, a mother of three in Las Vegas, told me that, in addition to paying $40,000 a year in private school tuition (not an allowable expense in dependent care savings accounts), she also pays more than $12,000 a year for preschool (which is allowed).

“The cost of child care is insane and COVID made it worse. It blows my mind that I can shield $19,500 in a 401(k) for retirement but God forbid I get a break trying to afford child care for the kids,” she said.

As lawmakers consider how to move forward with next steps to help American families — with or without the “Build Back Better” Act — allowing parents a $10,500 limit, or more, on dependent care savings accounts is a quick and easy solution that would make a significant impact on stressed and strained families budgets.

Bethany Mandel is a contributing writer for the Deseret News and an editor at

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