One person plan - unvested ER @bop

[TPApril]

One person plan for a doctor - for the beginning five years of the plan, the doctor is not vested in the profit sharing contribution. Inasmuch as a plan is meant to be more permanent than 5 years, how to explain to plan owner that the money is theirs even if they are not vested at the current time in the first five years? (in this example, plan started when employment started).

[Mike Preston]

How do you escape TH vesting? 

[ESOP Guy]

Point out if the plan terminates before they are fully vested by law everyone becomes 100% vested.   Unless they sponsor on employees soon why don't just make the plan 100% vested from day 1? 

[david rigby]

Is it reasonable plan design to have a one-person plan with a vesting schedule? 

(I know there is at least one reason for doing so, but the orginal post made no such reference.  Absent that, seems unnecessary.)

[Lou S.]

It is very reasonable to have a vesting schedule for 1 person plan.

#1 in case plans change and he hires someone.

#2 if the plan is put in at or near age 70.5 to delay first RMD.

#3 I'm sure there is a good #3 but I can't think of it.

[TPApril]

Thanks much for the responses.

Plan is a part of a control group - each doctor has their own plan. There is an equivalent plan with same provisions for the staff. Same investment options. Why keep plans separate at this point since restated plans have them set up similarly in spite of recommendations to merge them? Because they have always been separate and the legacy doctors feel they have more control that way.

Mike - I should have typed 'fully vested' as plan is on 2/20%.

[david rigby]

Agreed.  But I read the OP as if (1) and (2) are never going to apply.