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You are having a baby

A baby adds costs, a tax credit, a new benefit to sign up for and some deadlines. Most of the paperwork is due in the first 30 to 60 days.

First 3 things this week

About 30 seconds to read. Ticks stay on this device.

0 of 3 done

How it works

  1. Add the baby to coverage

    A birth is a qualifying life event. Marketplace plans give 60 days, and employer plans often give about 30. Your plan's out-of-pocket maximum caps what you pay in network for covered care in a year. For 2026 the legal ceiling is $10,600 for one person and $21,200 for a family, and many plans set it lower.

  2. Get the Social Security number

    Social Security says the easiest way is to apply when you provide the information for the birth certificate at the hospital. You need the number to claim the child tax credit.

  3. Know the child tax credit

    For 2026 the child tax credit is up to $2,200 per qualifying child, and up to $1,700 of it can be refunded. The child must be under 17 at the end of the year, and the child and the filer need Social Security numbers valid for work.

  4. Look at a dependent care FSA

    A dependent care FSA lets you pay for child care with pre-tax pay. The limit is $7,500 per household in 2026, or $3,750 if married filing separately, up from $5,000 and $2,500. Money paid through the FSA cannot also be counted for the child and dependent care credit.

  5. Plan for the long costs

    A 529 plan holds money for education costs, and earnings used for qualified costs are not taxed. A gift of up to $19,000 per person per year stays under the 2026 annual gift tax exclusion. Life insurance replaces income if a parent dies, and the life insurance lab prices a need. A federal pilot also deposits $1,000 into a Trump account for some children born from 2025 through 2028, and you elect it with IRS Form 4547.

A worked example

Sample, not your numbers

What a dependent care FSA saves on child care

Sample numbers: child care of $1,200 a month, a $14,400 year. The FSA covers the $7,500 limit, and the household is in the 22% federal bracket.

Child care for the year
$14,400
Paid through the FSA
$7,500
Federal income tax avoided at 22%
$1,650
Payroll tax avoided at 7.65%
$573.75
Total tax avoided
$2,223.75

The saving is tax, not free money, and it applies only to dollars you would spend on care anyway. State tax is left out, and your bracket may differ.

What to ask HR, your lender or a tax pro

HR or the benefits team

  • What does parental leave pay, and how long does it last?
  • How long do I have to add the baby to the health plan?
  • Is there a dependent care FSA, what is its limit here, and can I start it after the birth?
  • Does the company offer group life insurance, and what is the beneficiary form deadline?

A tax pro

  • How do the child tax credit, the dependent care FSA and the child and dependent care credit fit together for us?

Run your own numbers

Chapter 11: insurance & risk management covers life, health and disability insurance with your own numbers. Chapters 4 to 18 are Pro.

Sources

Figures read from these pages on October 6, 2026. Employer plans can set lower limits and different deadlines than the federal ones here. Credits depend on income and filing status, and a tax pro can check yours.

Education, not financial, tax or legal advice. The example uses sample numbers, and your own situation will differ.