401Karina Posted December 30, 2022 Posted December 30, 2022 An employee was re-hired after incurring five 1-year breaks in service. He never took a termination distribution from the plan. Since he is now an active employee but not yet eligible to re-enroll in the plan, is he able to borrow against his account in the plan?
C. B. Zeller Posted December 31, 2022 Posted December 31, 2022 The rule of parity allows you to disregard eligibility service before 5 consecutive 1-year breaks in service for an unvested participant. If this person has a vested balance in the plan then they probably entered the plan immediately upon re-hire, regardless of how many 1-year breaks in service occurred. Bill Presson, truphao, ESOPMomma and 1 other 4 Free advice is worth what you paid for it. Do not rely on the information provided in this post for any purpose, including (but not limited to): tax planning, compliance with ERISA or the IRC, investing or other forms of fortune-telling, bird identification, relationship advice, or spiritual guidance. Corey B. Zeller, MSEA, CPC, QPA, QKA Preferred Pension Planning Corp.corey@pppc.co
Bri Posted January 3, 2023 Posted January 3, 2023 ...and it's probably, as CBZ indicated, *immediate* upon rehire. (As opposed to waiting for the plan's next normal entry date for newly eligible folks.) Luke Bailey, Bill Presson, ESOPMomma and 1 other 4
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