Maintaining Internal Revenue Code Limit Tables

This topic lists the pages used to maintain Internal Revenue Code limit tables.

To access these pages, use either of the following menu paths:

  • Set Up HCM > Product Related > Pension > Calculation Tables

  • Pension > Define Calculation Tables

Page Name

Definition Name

Usage

TRA 86 Limits

PA_TL_TRA86_TBL

Update the Section 401(a)(17) limits that are based on TRA 86.

OBRA 93 Limits

PA_TL_OBRA93_TB

Update the Section 401(a)(17) limits that are based on OBRA 93.

415(b) Max Dollar Limits

PA_TL_415_LIMIT

Maintain the Section 415(b) limits.

415(c) DC Limits

PA_TL_415_LIMDC

Maintain the Section 415(c) limits.

Section 415 of the Internal Revenue Code limits a person's total pension benefit from all qualified plans. Section 401(a)(17) of the code limits the amount of annual earnings that can be used in determining a pension benefit. Pension Administration delivers the tables with the limits published by the Internal Revenue Service (IRS).

Because PeopleSoft maintains these tables, it is unlikely that you will need to edit the existing values. However, you can update the tables if you want.

Section 401(a)(17) Limits

Two tables are used for Section 401(a)(17) limits: TRA '86 and OBRA '93. This is necessary because a transition rule enabled bargained plans to use the previous limits that were in effect when OBRA (the federal Omnibus Budget Reconciliation Act) reduced the limit for non-bargained plans to 150,000 USD. As of 1997, 401(a)(17) limits are the same for bargained and non-bargained plans.

Section 415 Limits

Section 415(b) of the Internal Revenue Code specifies a monetary limit on an employee's total pension benefit from all qualified defined benefit plans. The limit was originally 90,000 USD in 1987; it has been adjusted annually to accommodate the increase in the cost of living.

Prior to its repeal, section 415(e) of the Internal Revenue Code limited the combined benefits from all defined benefit and defined contribution plans. If you sponsor a defined contribution plan, this historical limit may still apply to employees who participate in both plans. To determine whether this is so, you must compute an employee's defined contribution fraction. One of the components needed to determine this fraction is the IRS's published limits for defined contribution plans. Although Pension Administration does not calculate the defined contribution fraction, PeopleSoft provides a table of defined contribution limits for your information.

Note: Section 415(e) is no longer in effect as of January 1, 2000.