Part I. Rulings and Decisions Under the Internal Revenue Code of 1986

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

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

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.

Rev. Rul. 2004–104

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

2005 COVERED COMPENSATION TABLE

CALENDAR YEAR OF SOCIAL

SECURITY RETIREMENT AGE

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

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

2004–46 I.R.B. 837 November 15, 2004

2005 COVERED COMPENSATION

CALENDAR YEAR OF BIRTH

2005 COVERED COMPENSATION TABLE

CALENDAR YEAR OF SOCIAL

SECURITY RETIREMENT AGE

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

November 15, 2004 838 2004–46 I.R.B.

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

Eastern time, Monday through Friday (a toll-free number). Mr. Isaacs’s number is (202) 283–9710 (not a toll-free number).

Drafting Information

The principal author of this revenue ruling is Lawrence Isaacs of the Employee Plans, Tax Exempt and Government Enti

ties 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.

2004–46 I.R.B. 839 November 15, 2004