Blogging Employee Benefits

October 18, 2006

2007 Pension Thresholds

Filed under: Pensions — Fuguerre @ 8:35 am

With the BLS reporting the September 2006 CPI this morning, I can finalize my previous estimates of COLAs for key pension thresholds. These numbers remain unofficial, since of course only the IRS has the authority to publish the official numbers. But relying on the same rounding conventions used by the agency for prior years, the numbers I expect to see are as follows –

            2007   2006
    Limitation on Elective Deferrals   §402(g)(1)   $15,500   $15,000
    Limitation on Catchup Deferrals   §414(v)(2)(B)(i)   $5,000   $5,000
    Limitation on Benefits   §415(b)(1)(A)   $180,000   $175,000
    Compensation-Based Limitation Increase Factor   §415(b)(1)(B)   1.0334   1.0383
    Limitation on Annual Additions   §415(c)(1)(A)   $45,000   $44,000
    Limitation on Compensation   §401(a)(17), 404(l)   $225,000   $220,000
    Highly Compensated Employee Determination   §414(q)(1)(B)   $100,000   $100,000

For the elective deferral threshold, the numbers came in just barely over the line needed for the increase to $15,500, with the September CPI-U at 202.9. At 202.8, the limit would have remained level at $15,000.



  1. Separately but semi-related economically, the Social Security Administration has announced COLA increases for 2007, including an increase in the taxable wage base to $97,500.

    Comment by Fuguerre — October 18, 2006 @ 12:45 pm

  2. IRS numbers in the main post here have been confirmed by IR-2006-162.

    Comment by Fuguerre — October 18, 2006 @ 12:52 pm

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