Small Business Dependent Care FSA Opportunity Act

On March 12, 2026, Rep. Smith (R-NE) introduced HR7922 with two cosponsors. The bill was referred to the House Committee on Ways and Means and currently has no further action. As an early-stage authorization bill, it has not been passed, signed, or appropriated. The bill amends the Internal Revenue Code to create a new tax credit under IRC §45BB for small employers' dependent care flexible spending plan startup costs. The credit covers 100% of qualified startup costs, capped at the greater of $500 or $250 per non-highly-compensated employee (up to $5,000 max), and is available for the first credit year plus the two following tax years. Employers that have offered a dependent care FSA in the preceding 3 years are ineligible. This is a non-appropriated structure — the credit reduces tax revenue, not direct spending. Because of the small per-employee caps, the estimated revenue impact is negligible at scale (no CBO score in the text). The mechanism reduces the primary barrier to SMB FSA adoption: the fixed cost of plan setup, compliance, and administration. For companies like PAYX and ADP that sell FSA administration as a per-employee-per-month fee, this lowers customer acquisition friction. WEX benefits similarly, though its larger enterprise mix reduces proportional exposure. The bill has no impact on large employers already offering dependent care FSAs. Current market data shows ADP with the strongest near-term momentum (7-day +8.33%, 30-day +4.79% to $212.92), PAYX stable (+3.81% 7-day, +1.22% 30-day to $93.24), and WEX volatile (-1.14% 30-day to $151.31). The legislative path requires committee markup, House passage, Senate companion introduction, and reconciliation — timeline to enactment is likely 12-24 months given early-stage status.