Rehired "Eligible Participant" under OBRA '93

[Rafael]

Hello. I was wondering if anyone had heard of any guidance with respect to a participant who is an "eligible participant" for purposes of the 401(a)(17) limits who was terminated and was then later rehired by the same employer.

Under Treas. Reg. 1.401(a)(17)-1(d)(4)(B), an "eligible participant" for purposes of the grandfathered limits is "an individual who first became a participant in the plan prior to the first day of the first plan year beginning after the earlier of - (1) The last day of the plan year by which a plan amendment to reflect the amendments made by section 13212 of OBRA '93 is both adopted and effective; or (2) December 31, 1995." (emphasis added).

Based on the use of the word "first," I would believe there is an argument that an individual who was an "eligible participant," terminated employment, and was later rehired and became a participant again would still qualify as an "eligible participant" since that individual "first" became a participant during the appropriate deadline. However, I was hoping to see if anyone on the Board had heard any different or had alternate thoughts. The Preambles to the reg are not helpful

Thanks!