Dependent care FSA's allow working parents or caretakers to pay for child or adult care with pre-tax dollars. There is a $5,000 annual limit on these accounts, which has not changed since 1986. An increase to this limit, proportional to the increase in child care is necessary to help working parents afford ever-increasing child care costs. Typical day care costs are over $200 per child per week; $5,000 therefore only covers a single child for less than six months
In addition to helping working people afford dependent care, increasing this limit will also provide an incentive to pay in-home caretakers above-board instead of "under the table", thereby bringing more private caretakers (who are currently paid in cash) into the revenue and benefits system.