26 CFR 1.401(l)-1: Permitted disparity in employer-provided contributions or benefits

Part I

Section 401. -- Qualified Pension, Profit-Sharing, and Stock Bonus Plans

26 CFR 1.401(l)-1: Permitted disparity in employer-provided contributions or

benefits

Rev. Rul. 2017-05

This revenue ruling provides tables of covered compensation under

§ 401(l)(5)(E) of the Internal Revenue Code and the Income Tax

Regulations thereunder, for the 2017 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) 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

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 2017 year, the

taxable wage base is $127,200.

The following tables provide covered compensation for 2017.

ATTACHMENT I

2017 COVERED COMPENSATION TABLE

CALENDAR

CALENDAR YEAR OF

2017 COVERED

YEAR OF

SOCIAL SECURITY

COMPENSATION

BIRTH

RETIREMENT AGE

TABLE II

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

1

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

ATTACHMENT I

2017 COVERED COMPENSATION TABLE

CALENDAR

CALENDAR YEAR OF

2017 COVERED

YEAR OF

SOCIAL SECURITY

COMPENSATION

BIRTH

RETIREMENT AGE

TABLE II

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

48,816

1941

2007

51,348

1942

2008

53,952

1943

2009

56,628

1944

2010

59,268

1945

2011

61,884

1946

2012

64,560

1947

2013

67,308

1948

2014

69,996

1949

2015

72,636

1950

2016

75,180

1951

2017

77,880

1952

2018

80,496

1953

2019

83,052

1954

2020

85,560

1955

2022

90,372

1956

2023

92,724

1957

2024

94,980

1958

2025

97,152

1959

2026

99,264

1960

2027

101,304

1961

2028

103,296

1962

2029

105,204

1963

2030

107,088

1964

2031

108,924

1965

2032

110,700

1966

2033

112,380

1967

2034

113,940

ATTACHMENT I

2017 COVERED COMPENSATION TABLE

CALENDAR

CALENDAR YEAR OF

2017 COVERED

YEAR OF

SOCIAL SECURITY

COMPENSATION

BIRTH

RETIREMENT AGE

TABLE II

1968

2035

115,392

1969

2036

116,724

1970

2037

117,936

1971

2038

119,088

1972

2039

120,204

1973

2040

121,272

1974

2041

122,220

1975

2042

123,060

1976

2043

123,780

1977

2044

124,368

1978

2045

124,944

1979

2046

125,532

1980

2047

126,024

1981

2048

126,408

1982

2049

126,696

1983

2050

126,948

1984 and Later

2051 and Later

127,200

ATTACHMENT II

2017 ROUNDED COVERED COMPENSATION TABLE

CALENDAR

2017 COVERED

Y

2039

120,204

1973

2040

121,272

1974

2041

122,220

1975

2042

123,060

1976

2043

123,780

1977

2044

124,368

1978

2045

124,944

1979

2046

125,532

1980

2047

126,024

1981

2048

126,408

1982

2049

126,696

1983

2050

126,948

1984 and Later

2051 and Later

127,200

ATTACHMENT II

2017 ROUNDED COVERED COMPENSATION TABLE

CALENDAR

2017 COVERED

YEAR OF

COMPENSATION

BIRTH

ROUNDED

1937

$ 39,000

1938 – 1939

45,000

1940

48,000

1941

51,000

1942

54,000

1943

57,000

1944

60,000

1945

63,000

ATTACHMENT II

2017 ROUNDED COVERED COMPENSATION TABLE

CALENDAR

2017 COVERED

YEAR OF

COMPENSATION

BIRTH

ROUNDED

1946 – 1947

66,000

1948

69,000

1949

72,000

1950

75,000

1951

78,000

1952

81,000

1953

84,000

1954

87,000

1955

90,000

1956

93,000

1957 – 1958

96,000

1959

99,000

1960 – 1961

102,000

1962

105,000

1963 – 1964

108,000

1965 – 1966

111,000

1967 – 1968

114,000

1969 – 1970

117,000

1971 – 1973

120,000

1974 – 1977

123,000

1978 – 1981

126,000

1982 and Later

127,200

DRAFTING INFORMATION

The principal author of this notice is Tom Morgan of the Office of the Associate

Chief Counsel (Tax Exempt and Government Entities). However, other

personnel from the IRS participated in the development of this guidance. For

further information regarding this notice, contact Mr. Morgan at 202-317-6700 or

Michael Spaid at 206-946-3480 (not toll-free numbers).