What Does Block 24e Mean on Your W-2 Form?

The W-2 form, officially known as the Wage and Tax Statement, is an annual document employers issue to their employees and the Internal Revenue Service (IRS). Its primary purpose is to report an employee’s annual wages and the amount of taxes withheld. This form is used for filing income tax returns. The W-2 contains various numbered “blocks” or “boxes,” each designated for specific financial information.

Meaning of Block 24e

Block 24e on your W-2 form specifically reports the total amount of dependent care benefits an employer provided to you during the tax year. These benefits are typically part of a Dependent Care Assistance Program (DCAP), designed to help employees cover the costs of care for their qualifying dependents. Dependent care benefits can include employer-paid childcare, elder care, or other care services for dependents, enabling the employee to work or look for work.

The amount shown in Block 24e encompasses both direct payments made by the employer for dependent care and any amounts the employee contributed pre-tax through a Dependent Care Flexible Spending Account (FSA). This block summarizes all employer-sponsored dependent care support received. Understanding this amount is important for proper tax reporting and for calculating potential tax credits.

Tax Implications of Dependent Care Benefits

The amount reported in Block 24e, representing dependent care benefits, is excludable from an employee’s gross income up to certain IRS limits. For the 2025 tax year, this exclusion limit is $5,000 for single filers or married couples filing jointly, and $2,500 for married individuals filing separately. Benefits up to these thresholds are not considered taxable income and are not included in Box 1 of the W-2.

If dependent care benefits exceed these annual limits, the excess amount becomes taxable income. This excess is added to the employee’s wages and reported in Box 1 of the W-2 form. The amount in Block 24e is generally separate from Box 1 for tax purposes, unless the benefits exceed the excludable amount.

Claiming the Child and Dependent Care Credit

The information in Block 24e is relevant for the Child and Dependent Care Credit, a tax credit designed to help offset the costs of care for a qualifying child or dependent. While Block 24e reflects employer-provided benefits, taxpayers may still qualify for this credit based on out-of-pocket dependent care expenses. The credit assists taxpayers who incur care expenses so they can work or look for work.

When calculating the Child and Dependent Care Credit, the amount reported in Block 24e reduces the total expenses that can be used for the credit. This adjustment prevents taxpayers from receiving a double tax benefit for the same expenses—once through employer-provided tax-free benefits and again through a tax credit. Taxpayers use IRS Form 2441, Child and Dependent Care Expenses, to calculate and claim this credit, entering the Block 24e amount for correct calculation.