Purpose:

The purpose of this bulletin is to notify agencies of the following maximum contribution limits for employees enrolled in the New York State Deferred Compensation Plan for the calendar year 2025

Background:

Pursuant to IRS IR-2024-285, released on November 1, 2024: 

• The regular yearly contributions amount for Deferred Compensation will increase from $23,000 to $23,500.
  • The catch-up contribution limit that generally applies for employees aged 50 and over remains at $7,500 for 2025 for a combined maximum contribution limit of $31,000 in 2025.
  • Effective January 1, 2025, Section 109 of the Secure 2.0 Act increases the catch-up contribution limit for active participants turning ages 60, 61, 62, or 63 in the calendar year to either $10,000 or 50% more than the regular catch-up contribution limit, whichever is greater. This catch-up contribution limit is set at $11,250 for 2025 for a combined maximum contribution limit of $34,750.
• The Deferred Compensation “Retirement Catch-Up” provision, available to employees in each of the last three years prior to normal retirement age, increases from $23,000.00 to $23,500, for a combined maximum contribution of $47,000 for calendar year 2025.

Employees are not eligible to choose both the “Retirement Catch-Up” and the “50 and Over Catch-Up” in the same calendar year.

Affected Employees:

Employees enrolled in the New York State Deferred Compensation Plan are affected.

Effective Date:

January 1, 2025

OSC Actions:

OSC will update PayServ to reflect the maximum contribution limits for calendar year 2025 and will process the additional catch-up contribution limits as provided by the Deferred Compensation vendor.

Questions:

Questions regarding this bulletin, including questions regarding annual and applicable catch-up limits, may be directed to the New York State Deferred Compensation Plan or by calling the helpline at 1-800-422-8463.