Student Employee exclusion

[mattmc82]

I have two takeover 403(b) plans that have Student Employees listed as an excluded class. It was my understanding that this exclusions would not apply unless the plan was for a school, and that employee was a student of that school.

the prior TPA had been excluded all employees that were currently and regularly attending class. But neither plan is an educational instutiion (or auxillary to one)

Agree or disagree with me that this is incorrect and that all of those employees that otherwise satisfied the eligibility requirements should be in the plan and eligible for all contributions?

[Belgarath]

Interesting question. The 403(b) exclusion is for ..."employees who are students performing services described in section 3121(b)(10)."

3121(b)(10) provides:

(10) service performed in the employ of—
(A) a school, college, or university, or

(B) an organization described in section 509(a)(3) if the organization is organized, and at all times thereafter is operated, exclusively for the benefit of, to perform the functions of, or to carry out the purposes of a school, college, or university and is operated, supervised, or controlled by or in connection with such school, college, or university, unless it is a school, college, or university of a State or a political subdivision thereof and the services performed in its employ by a student referred to in section 218©(5) of the Social Security Act are covered under the agreement between the Commissioner of Social Security and such State entered into pursuant to section 218 of such Act;

if such service is performed by a student who is enrolled and regularly attending classes at such school, college, or university;...

So, basically, if I'm sponsoring a 403(b) plan, it makes no sense to me to assert that my Employee can be excluded from my plan under the 403(b) nondiscrimination rules, based upon service (and being a student) with another, completely unrelated employer.