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Overview
The dependent care spending account (DCSA) provides you with the opportunity to fund dependent care expenses through pre-tax payroll deductions so that you, or you and your spouse, can work, actively seek employment or attend school full time. Since pre-tax deductions are not considered taxable income, this account can save you money by reducing your taxable income. Any reimbursement that you receive from the DCSA is tax-free.
Additional Details
It is important to keep in mind that DCSA is a "use it or lose it account." The IRS requires that money accrued in your account for a calendar year cannot be refunded to you, carried over beyond March 15 of the next calendar year or transferred to another account. If your claim for reimbursement does not meet the eligibility requirements or fall within the assigned timeframe, the money in your account will be forfeited. To avoid forfeiting money, it is important to accurately predict your dependent care for the year.
Eligibility
You are eligible to participate if you are a regular status, salaried employee scheduled to work at least 20 hours a week.
Qualifying Dependent:An eligible dependent is either a “qualifying child” up to age 13 or a mentally or physically disabled individual regardless of age. A disabled individual is either your spouse, “qualifying child” or “qualifying relative.”
A “qualifying child” is someone who:
- Is your child or grandchild, brother or sister (or stepbrother or stepsister), or niece or nephew;
- Lives with you for more than half of the year;
- Receives more than half of his or her support during the year from you; and
- Is a citizen or national of the United States or a resident of the United States, Canada or Mexico.
If you are divorced or separated, you must either be the custodial parent or have a waiver of dependent exemption from the custodial parent.
A “qualifying relative” for this purpose is someone who:
- Is your father or mother (or ancestor), stepmother or stepfather, aunt or uncle, or in-law (father, mother, sister, brother, son or daughter), or is an individual who (other than a spouse) lives with you and is a member of your household (unless the relationship violates local law
- Receives more than half of his or her support during the year from you; and
- Is a citizen or national of the United States or a resident of the United States, Canada or Mexico.
If you have questions regarding eligible dependents or qualifying relatives, contact Ceridian at 877.799.8820.
For additional information regarding eligibility refer to the eligibility section of the Flexible Spending Accounts Benefit Plan Summary (PDF). If you have questions, contact the Employee Services Unit (ESU) at 4-ESU@travelers.com or 800.441.4378.
Cost
You fund the DCSA with pre-tax payroll deductions. Your deductions are determined by the amount that you elect to deposit for the next calendar year, or if you are a new hire, the amount that you elect to deposit for the current calendar year.
During Annual Benefits Enrollment or within 31 days of your hire date if you are a new hire, you can elect to deposit any amount between $200 and $5,000 for a calendar year. If you are married and file separate tax returns, the maximum amount you can deposit is $2,500. That amount is then divided equally between the paychecks that you will receive in that calendar year and is deducted from each paycheck on a pre-tax basis.
Example: You are contributing $200 per pay period to DCSA. On January 20, you submit a claim for $750 in eligible expenses. The plan would pay out $200 (amount contributed through your 1/15 payroll deduction) and the remaining $550 would be pended until additional funds become available (1/31 pay period contribution).
Once you make an election amount, you cannot change your election amount outside of Annual Benefits Enrollment unless you experience a qualified status change event and the requested change would need to be consistent with the change event. For additional information regarding what constitutes a qualified status change event, please consult the qualified status change section of the Benefit Plan Summaries.
Use the FSA Savings Calculator to determine the amount you should elect for your DCSA.
Related Programs & Resources
Ceridian's Web site contains several tools to help you effectively manage your DCSA:
How do I begin?
- Go to www.ceridian-benefits.com.
- For your initial login only, you will use your Social Security number (including dashes, e.g., 111-11-1111) as your login. Your password/PIN is the last four numbers of your Social Security number reversed.
- The system will require you to change your login ID and password/PIN for future access to your account.
- Click on the link for your plan, which is listed by plan ID (Plan ID #L02338), company name and plan year.
- If you are unable to access Ceridian online, contact Ceridian customer service at 877.799.8820.
What will I find?
- Account information and current claim status.
- Which payments have been made and payment date.
- How much money you have left in your account.
- Expenses eligible for DCSA reimbursement.
How to Enroll
Access the How to Enroll page for enrollment instructions.
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