IRS Limits on Defined Benefit Pension Plan Benefit

Internal Revenue Code Section 415(b) limits the annual dollar amount that the Pension Plan can pay to a Participant. The IRC 415(b) Limit is based on several factors, including the Participant’s age when the Participant begins receiving Pension Plan benefits. The Internal Revenue Service (“IRS”) periodically makes cost-of-living adjustments to the IRC 415(b) Limit.

Internal Revenue Code Section 401(a)(17) limits the annual dollar amount of compensation that the Pension Plan (a Private Plan) can use to determine a Participant’s Pension Plan benefit. A more generous IRC 401(a)(17) Limit [based on the 401(a)(17) limit in effect on July 1, 1993, as adjusted for cost-of-living] applies to certain Governmental Plans such as the University of California Retirement Plan. The IRS periodically makes cost-of-living adjustments to the IRC 401(a)(17) Limit for Private Plans and for Governmental Plans.


Calendar Year IRC 415(b)(1)(a) Annual Benefits Payment Limit (at Age 62 [1,2]) IRC 401(a)(17) Annual Compensation Limit [3]  
2020 $230,000 $285,000
2021 $230,000 $290,000
2022 $245,000 $305,000


  1. The limit is age-adjusted for retirement date prior to age 62.
  2. LLNS Restoration Plan provides relief (see Restoration Plan for details).
  3. Impacts calculation of the HAPC for certain high-earners with salaries above this amount (contact the Benefits Office for more information).