PERAC Memo #2 - 2014: 2014 Limits under Section 23 of Chapter 131 of the Acts of 2010
2014 Limits under Section 23 of Chapter 131 of the Acts of 2010
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PERAC Memorandum #02/2014 notifies boards that, for calendar year 2014, the regular compensation limit under Chapter 131 of the Acts of 2010 (applicable to members who joined a retirement system after January 1, 2011) is $166,400—64% of the IRS 401(a)(17) limit of $260,000. Boards must apply this cap when calculating regular compensation for these post-2011 members; no other action is required beyond ensuring payroll/compensation reporting reflects this limit.
Full Text
MEMORANDUM #02, 2014 Robert B. McCarthy M E M O R A N D U M TO: All Retirement Boards FROM: Joseph E. Connarton, Executive Director RE: 2014 Limits under Section 23 of Chapter 131 of the Acts of 2010 DATE: January 6, 2014 Pursuant to Section 23 of Chapter 131 of the Acts of 2010, “regular compensation for any person who becomes a member of a retirement system after January 1, 2011 shall not include salary, wages or other compensation in whatever form in any calendar year in excess of 64 per cent (64%) of the annual limitation that may be imposed under federal law on the amount of compensation that may be taken into account when calculating benefits under plans described in 26 U.S.C. 401(a) including, but not limited to, the applicable limits for any calendar year under 26 U.S.C. 401(a)(17).” For 2014, the general compensation limit found in U.S.C. 401(a)(17) is $260,000, as outlined in PERAC Memorandum #1/2014. Thus the 2014 limit on regular compensation under G.L. 32 for persons who became members after January 1, 2011 is $166,400. Please contact our Actuary, Jim Lamenzo, if you have any questions.