Rev. Rul. 2004-104
Rev. Rul. 2004-104
2005 covered compensation tables; permitted disparity. The covered compensation tables under section 401 of the Code for the year 2005 are provided for use in determining contributions to defined benefit plans and permitted disparity.
This revenue ruling provides tables of covered compensation under § 401(l)(5)(E) of the Internal Revenue Code (the “Code”) and the Income Tax Regulations, thereunder, for the 2005 plan year.
Section 401(l)(5)(E)(i) defines covered compensation with respect to an employee, as the average of the contribution and benefit bases in effect under section 230 of the Social Security Act (the “Act”) for each year in the 35-year period ending with the year in which the employee attains social security retirement age.
Section 401(l)(5)(E)(ii) of the Code states that the determination for any year preceding the year in which the employee attains social security retirement age shall be made by assuming that there is no increase in covered compensation after the determination year and before the employee attains social security retirement age.
Section 1.401(l)-1(c)(34) of the Income Tax Regulations defines the taxable wage base as the contribution and benefit base under section 230 of the Act.
Section 1.401(l)-1(c)(7)(i) defines covered compensation for an employee as the average (without indexing) of the taxable wage bases in effect for each calendar year during the 35-year period ending with the last day of the calendar year in which the employee attains (or will attain) social security retirement age. A 35-year period is used for all individuals regardless of the year of birth of the individual. In determining an employee’s covered compensation for a plan year, the taxable wage base for all calendar years beginning after the first day of the plan year is assumed to be the same as the taxable wage base in effect as of the beginning of the plan year. An employee’s covered compensation for a plan year beginning after the 35-year period applicable under § 1.401(l)-1(c)(7)(i) is the employee’s covered compensation for a plan year during which the 35-year period ends. An employee’s covered compensation for a plan year beginning before the 35-year period applicable under § 1.401(l)-1(c)(7)(i) is the taxable wage base in effect as of the beginning of the plan year.
Section 1.401(l)-1(c)(7)(ii) provides that, for purposes of determining the amount of an employee’s covered compensation under § 1.401(l)-1(c)(7)(i), a plan may use tables, provided by the Commissioner, that are developed by rounding the actual amounts of covered compensation for different years of birth.
For purposes of determining covered compensation for the 2005 year, the taxable wage base is $90,000.
The following tables provide covered compensation for 2005:
| 2005 COVERED COMPENSATION TABLE | ||
|---|---|---|
| CALENDAR YEAR OF BIRTH | CALENDAR YEAR OF SOCIAL SECURITY RETIREMENT AGE | 2005 COVERED COMPENSATION |
| --- | --- | --- |
| 1907 | 1972 | $4,488 |
| 1908 | 1973 | 4,704 |
| 1909 | 1974 | 5,004 |
| 1910 | 1975 | 5,316 |
| 1911 | 1976 | 5,664 |
| 1912 | 1977 | 6,060 |
| 1913 | 1978 | 6,480 |
| 1914 | 1979 | 7,044 |
| 1915 | 1980 | 7,692 |
| 1916 | 1981 | 8,460 |
| 1917 | 1982 | 9,300 |
| 1918 | 1983 | 10,236 |
| 1919 | 1984 | 11,232 |
| 1920 | 1985 | 12,276 |
| 1921 | 1986 | 13,368 |
| 1922 | 1987 | 14,520 |
| 1923 | 1988 | 15,708 |
| 1924 | 1989 | 16,968 |
| 1925 | 1990 | 18,312 |
| 1926 | 1991 | 19,728 |
| 1927 | 1992 | 21,192 |
| 1928 | 1993 | 22,716 |
| 1929 | 1994 | 24,312 |
| 1930 | 1995 | 25,920 |
| 1931 | 1996 | 27,576 |
| 1932 | 1997 | 29,304 |
| 1933 | 1998 | 31,128 |
| 1934 | 1999 | 33,060 |
| 1935 | 2000 | 35,100 |
| 1936 | 2001 | 37,212 |
| 1937 | 2002 | 39,444 |
| 1938 | 2004 | 43,992 |
| 1939 | 2005 | 46,344 |
| 1940 | 2006 | 48,696 |
| 1941 | 2007 | 51,012 |
| 1942 | 2008 | 53,268 |
| 1943 | 2009 | 55,464 |
| 1944 | 2010 | 57,636 |
| 1945 | 2011 | 59,772 |
| 1946 | 2012 | 61,872 |
| 1947 | 2013 | 63,936 |
| 1948 | 2014 | 65,856 |
| 1949 | 2015 | 67,680 |
| 1950 | 2016 | 69,408 |
| 1951 | 2017 | 71,052 |
| 1952 | 2018 | 72,600 |
| 1953 | 2019 | 74,100 |
| 1954 | 2020 | 75,540 |
| 1955 | 2022 | 78,228 |
| 1956 | 2023 | 79,512 |
| 1957 | 2024 | 80,712 |
| 1958 | 2025 | 81,816 |
| 1959 | 2026 | 82,860 |
| 1960 | 2027 | 83,844 |
| 1961 | 2028 | 84,780 |
| 1962 | 2029 | 85,620 |
| 1963 | 2030 | 86,436 |
| 1964 | 2031 | 87,216 |
| 1965 | 2032 | 87,924 |
| 1966 | 2033 | 88,536 |
| 1967 | 2034 | 89,040 |
| 1968 | 2035 | 89,424 |
| 1969 | 2036 | 89,700 |
| 1970 | 2037 | 89,844 |
| 1971 | 2038 | 89,940 |
| 1972 and later | 2039 | 90,000 |
| 2005 Rounded Covered Compensation Table | |
|---|---|
| Year of Birth | Covered Compensation |
| --- | --- |
| 1937 | 39,000 |
| 1938 - 1939 | 45,000 |
| 1940 | 48,000 |
| 1941 | 51,000 |
| 1942 - 1943 | 54,000 |
| 1944 | 57,000 |
| 1945 | 60,000 |
| 1946-1947 | 63,000 |
| 1948 | 66,000 |
| 1949-1950 | 69,000 |
| 1951-1952 | 72,000 |
| 1953-1954 | 75,000 |
| 1955 | 78,000 |
| 1956-1958 | 81,000 |
| 1959-1961 | 84,000 |
| 1962 - 1965 | 87,000 |
| 1966 and later | 90,000 |
Drafting Information
The principal author of this revenue ruling is Lawrence Isaacs of the Employee Plans, Tax Exempt and Government Entities Division. For further information regarding this revenue ruling, please contact the Employee Plans taxpayer assistance telephone service at 1-877-829-5500, between the hours of 8:00 a.m. and 6:30 p.m. Eastern time, Monday through Friday (a toll-free number). Mr. Isaacs’s number is (202) 283-9710 (not a toll-free number).