Search Form
Now choose a category »

Public Statements

Working Families Assistance Act of 2004

By:
Date:
Location: Washington, DC


WORKING FAMILIES ASSISTANCE ACT OF 2004 -- (House of Representatives - June 22, 2004)

Mr. CANTOR. Mr. Speaker, I move to suspend the rules and pass the bill (H.R. 4372) to amend the Internal Revenue Code of 1986 to provide for the carryforward of $500 of unused benefits in cafeteria plans and flexible spending arrangements for dependent care assistance.

BREAK IN TRANSCRIPT

Mr. CANTOR. Mr. Speaker, I yield myself such time as I may consume.

Mr. Speaker, families today shoulder tremendous financial burdens. The USDA's 2003 report estimates two-parent middle income families spend between $9,000 and $10,000 a year to raise one child. With 61 percent of working families relying on some form of child care, costs add up very quickly especially in families with more than one child. But it is not just child care expenses that families face. Many families have non-child dependents, including disabled parents or spouses living at home.

Dependent care accounts were created to assist families with two working parents to care for the young children or help these families who care for a disabled spouse or parent. These accounts allow up to $5,000 to be withheld pretax to help pay for this important care. Unfortunately, these accounts are not being utilized to their fullest extent. They were created in a use-it-or-lose-it fashion which often causes its users to underestimate the amount of money they need to put away, shortchanging the very people it was intended to help.

In 2002, the average contribution to these accounts was $3,024 with a net tax savings of $690, but this average contribution is almost $2,000 below the allowed contribution limit. The result is most families are missing out on almost 40 percent of the benefit.

Mr. Speaker, H.R. 4372, the Working Families Assistance Act, gives families peace of mind by allowing them the flexibility to roll over up to $500 of their money into the next year flexible savings account. So if you overestimated the amount you would spend on dependent care, you will now have a cushion to ensure your flexible spending account investment does not completely disappear.

The Working Families Assistance Act gives families the chance to realize the full tax benefit of this important program.

Mr. Speaker, I reserve the balance of my time.

BREAK IN TRANSCRIPT

Mr. CANTOR. Mr. Speaker, I yield myself such time as I may consume.

Mr. Speaker, I appreciate the remarks of the gentleman from Maryland. I think this, again, is a tremendous step forward in giving working families the ability to project what their dependent care expenses would be for the upcoming year and then to give them some flexibility if they do not quite hit the mark, so to speak. And this provision, this legislation echoes what we have done in the health savings accounts arena a few weeks ago in this House.

Mr. Speaker, I yield 3 minutes to my colleague, the gentleman from Minnesota (Mr. Kennedy).

BREAK IN TRANSCRIPT

Mr. CANTOR. Mr. Speaker, I thank the gentleman from Minnesota (Mr. Kennedy) and the gentleman from Maryland (Mr. Cardin) for their remarks, and I yield back the balance of my time.

Skip to top
Back to top