On October 26, 2020, the IRS issued IRS Notice 2020-79, announcing the changes in pensions and benefits limits for 2021. The maximum limit on annual additions (primarily to defined contribution plans) rose from $57,000 to $58,000 and the annual limit on compensation taken into account rose from $285,000 to $290,000. Most other limits stayed the same.
A chart showing details, and limits from 1996 to 2021, can be found at this link.
The Social Security Administration today announced that the wage base for 2021 will increase to $142,800 from $137,700. The limits for 1996 through 2021 are shown at this link.
Note: This outline is a basic summary of the principal Internal Revenue Code qualification requirements that apply to governmental plans, other than plans described in Code
Since the publication of this article, Treasury and the IRS have announced that any legal same-sex marriage will be recognized for federal tax purposes, regardless of whether the couple’s home state recognizes the marriage. See this post. The Department of Labor has also issued final regulations under the Family & Medical Leave Act which recognize a marriage, regardless of the couple’s domicile, if a) it occurred within the United States, and it was valid in the state in which it took place, and b) it occurred outside of the United States, if it was valid in the jurisdiction in which it took place and it could have been entered into in at least one state.
Federal law requires that employer plans determine marital status in a variety of contexts, ranging from requirements that ERISA-covered retirement plans provide spousal death benefits (e.g., a qualified joint and survivor annuity, qualified preretirement survivor annuity, or payment of the participant’s account balance to the spouse) to COBRA (health care continuation) rights in the event of a divorce or separation. In the wake of the Supreme Court’s decision in United States v. Windsor, it is clear that a same-sex married couple must be treated the same as an opposite-sex married couple for these purposes. But when will a same-sex couple be treated as married? Weeks after the Windsor decision, the few federal agencies that have issued guidance have taken wildly disparate approaches.