Years of service for previously excludible employee

[Guest jim williams]

When an employee's status goes from an excludible employee to an eligible employee are all years of service considered for participation purposes even for the period when the employee was excludible?

[david rigby]

Possibly. Service for partipation (IRC 410) and vesting (IRC 411) is based on employment with the "employer", which in this case would include the controlled group. It would also include a status (such as union or Division X) that is not covered by the plan.

But the definition in the plan still applies. For example, if the plan states that participation is on January 1 or July 1 after one year of service, then you still must observe how "year of service" is defined.