"A government 457(b) plan defines NRA as age 55. I'm trying to figure out whether that age is allowed under the facts.

The employer does not sponsor a defined benefit plan, but does sponsor a Money Purchase Plan. Under the applicable 457(b) regulations, an NRA of 55 is only allowed if age 55 is an age at which MPP participants 'have the right to retire and receive, under . . . a money purchase pension plan in which the participant also participates . . . immediate retirement benefits without actuarial or similar reduction because of retirement before some later specified age.' See 1.457-4(c)(3)(v)(A).

The MPP never has actuarial reductions. The MPP has cliff vesting after 5 years of service. The MPP allows distributions of the non-forfeitable account balance at age 45 after termination of employment. The MPP allows in-service distributions of the non-forfeitable account at age 62. The MPP provides for full vesting at age 65, even without 5 years of service (thus age 65 is the earliest age at which every participant is guaranteed not to have a forfeiture).

Under those facts, what is the earliest NRA allowed under the regulation cited above? There's never an actuarial reduction in the MPP, but there can be forfeiture reductions before age 65. Is a forfeiture a 'similar reduction' to an actuarial reduction making 65 the earliest allowed NRA? Or is age 45 the earliest allowed NRA, because forfeiture is not a 'similar reduction' to an actuarial reduction, and the participant can get their full non-forfeitable balance at age 45?"