This month, the IRS issued Notice 2024-80, which provides the 2025 cost-of-living adjustments on the dollar limitations for pensions and other benefits like LOSAPs. <\/p>\n\n\n\n
The limit on the benefit that can be provided in a LOSAP remained at $7,500 for the 2025 tax year. The historical limitations are as follows:<\/p>\n\n\n\n Since this blog is mainly focused on New York State LOSAPs, it is important to note that the New York State law has limitations that would not allow a sponsor to provide an annual benefit of $7,500. The maximum benefit that can be provided in a defined contribution plan is $1,200. For defined benefit plans, the $7,500 IRS limit applies to the actuarial value of the benefit earned during the year. The largest benefit that can be awarded in a defined benefit plan would be a $30 monthly benefit payable at age 55. This benefit would have a maximum actuarial value of around $6,000 using reasonable actuarial assumptions.<\/p>\n\n\n\n You can read the news release from the IRS here: https:\/\/www.irs.gov\/newsroom\/401k-limit-increases-to-23500-for-2025-ira-limit-remains-7000<\/a>.<\/p>\n\n\n\nYear<\/strong><\/td> Limit<\/strong><\/td><\/tr> up to 2017<\/td> $3,000<\/td><\/tr> 2018<\/td> $6,000<\/td><\/tr> 2019<\/td> $6,000<\/td><\/tr> 2020<\/td> $6,000<\/td><\/tr> 2021<\/td> $6,000<\/td><\/tr> 2022<\/td> $6,500<\/td><\/tr> 2023<\/td> $7,000<\/td><\/tr> 2024<\/td> $7,500<\/td><\/tr> 2025<\/td> $7,500<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n