Can a substantial risk of forfeiture exist in a not-for-profit 457f with certain vesting provisions?

[Guest flogger]

I'm finding that some sellers of non-qualified plans for not-for-profits are promoting plans that actually vest in the event of involuntary termination prior to normal retirement age. Does anyone know of any authority that would allow this?

If it is allowed, would it then be considered retirement income or severance income or ??? If severance, would it then be applied against the 2 times earnings cap?

Thanks in advance for any thoughts you have on this, or even what you've observed.

[Alf]

457(f)s can allow vesting on involuntary termination through the substantial risk of forfeiture rules in Code Section 83. I don't know about the characterization.