FICA Replacement Vesting

[nancy]

We recently took over a FICA Replacement plan.  The plan has a 7% employee contribution and a 13% employer contribution.  The employer contribution account has a vesting schedule that begins at year 5 with 50% vesting.  I was under the impression that at least 7.5% had to be 100% vested.  Can you have a vesting schedule?

[Luke Bailey]

100% immediate vesting is required only for part-time, seasonal, and temporary employees. Contrast 31.3121(b)(7)-2(d)(1)(ii) ("(other than vesting)") with 31.3121(b)(7)-2(d)(2)(i) (benefit must be "100% nonforfeitable" on any noncoverage day).