Final regs clarification

[LIBERTYKID]

I understand that for rule of parity purposes, if a participant makes a salary deferral to a plan that person is vested and the rule of party can't be used to forfeit vesting service, but I am unsure how the final regs changed things with regard to repayment upon rehire.

If participant has 10 dollars in a salary deferral account, and 85 dollars of nonvested money in the employer account, is the participant required to repay the 10 dollars in order to have the 85 dollars restored? Or does the plan deem the 85 dollars repaid upon rehire?

[Trekker]

I'm not writing with much confidence, so let's hope others chime in. I just want to help get the thread going.

I think since a participant with elective deferrals in his account has a vested account and may not be deemed to receive a cash-out, it seems to follow that with no deemed cash-out, you can not have a deemed back-back.

[jpod]

I'm confused. I understand the facts of the original post to be that the participant received a distribution of his/her vested account balance (i.e., the amount attributable to elective deferrals), and as a result the nonvested money was forfeited immediately. Otherwise, there would have been no reason for the poster to ask about buy-backs. If these are the facts, why wouldn't a timely buy-back be required in order to restore the forfeited money?