No 2016 Covered Compensation Tables?

[Übernerd]

Does anybody know why the IRS hasn't issued the Social Security covered comp tables for 2016 yet? I know the wage base didn't change, but that only affects the end-point of the 35-year average. Typically they issue the tables in a December Revenue Ruling, and we're almost to February.

Cheers.

[My 2 cents]

If the wage base didn't change, wouldn't the 2016 table automatically be exactly the same as the 2015 table (assuming you are not looking for a covered comp table based on future wage base increases, and the IRS never has anything to do with them)? So just use last year's covered comp table as is.

[Übernerd]

That was my first thought, but I thought the tables were based on a 35-year average, so even if the wage base didn't change for the last year of that period, wouldn't there have been a change for the first year (i.e., 35 years ago)?

[david rigby]

Check out the Revenue Ruilings page at https://www.irs.gov/Retirement-Plans/Revenue-Rulings-3.

The SSTWB was the same for 2009 thru 2011, and the Cov. Comp table for 2011 appears to be identical to 2009. There is no corresponding table or Rev. Ruling for 2010.

[My 2 cents]

That was my first thought, but I thought the tables were based on a 35-year average, so even if the wage base didn't change for the last year of that period, wouldn't there have been a change for the first year (i.e., 35 years ago)?

The different starting point is a function of the year of birth, not the year of the table. For example, look at someone born in 1965. SSNRA would be in 2032, so the 35-year average last year would take into account the actual wage bases from 1998-2015 plus the 2015 wage base as an assumption for each of 2016-2032. Looking at it this year, the 2016 wage base being the same as the 2015 wage base, while the number of assumed wage bases would be one lower than last year (i.e., for 2017-2032 instead of 2016-2032) and the number of actual wage bases one higher (i.e., for 1998-2016 instead of 1998-2015), the 35-year average would come out the same as it did last year because this year's actual 2016 wage base is the same as last year's estimated 2016 wage base and all of the subsequent wage bases are assumed to be the same as they were last year (except this year, they are all assumed to be the same as the 2016 wage base while last year they were all assumed to be the same as the 2015 wage base).

[Übernerd]

Excellent. That makes complete sense. Thanks!

[Mike Preston]

If the averaging period encompassed 2016 or later last year it would have used the 2015 TWB for those years. If the averaging period encompasses 2016 or later this year it will use the 2016 TWB. Those are identical.

[Peter Gulia]

For those of us who are less immediately knowledgeable than Ubernerd, My 2 cents, David Rigby, and Mike Preston, it would be nice if the IRS published in the Internal Revenue Bulletin the next year's table (even if nothing but its caption changed) with a one-paragraph introduction about why it didn't change.

[Übernerd]

For those of us who are less immediately knowledgeable than Ubernerd, My 2 cents, David Rigby, and Mike Preston, it would be nice if the IRS published in the Internal Revenue Bulletin the next year's table (even if nothing but its caption changed) with a one-paragraph introduction about why it didn't change.

Hear, hear!

[david rigby]

Yes it would be nice.

However, the current IRS philosophy is "do less with less", so it probably won't happen.

[My 2 cents]

The IRS has already eliminated most determination letter applications and also the Gray Book (a staple at the Enrolled Actuaries Meeting). Much of this stems from Congress, in its infinite wisdom, choosing to increasingly defund the IRS. Don't worry about the PBGC having to make do with less - statutory premium increases are a way to increase federal revenues to offset any spending increases elsewhere.

[Übernerd]

This is where I like to pull out my cocktail-party line about how all administrative agencies are unconstitutional (because they simultaneously exercise legislative, judicial, and executive powers).

[Effen]

There was a 2016 Covered Compensation Table in the Enrolled Actuaries Report released by the Academy Today.

[david rigby]

http://www.actuary.org/files/EAR_Winter2015.pdf

[My 2 cents]

Lo and behold! The 2016 table from the Enrolled Actuaries Report is exactly the same as the 2015 table published by the IRS. If they weren't, somebody would have some explaining to do!

[Tom Poje]

many years ago I worked out the following spreadsheet, only requires entering the new taxable Wage Base each year. hasn't failed me since 2005, well maybe once the rounding was off $1 for one year. so even if the IRS is slow in posting a new table...

covered comp at 118500.xls