Pixie Posted June 3, 2022 Posted June 3, 2022 I administer a plan that provides employer contributions for employees working less than 1000 hours but more than 500. When do the vesting provisions of the Secure act take effect? I have two participants that would be 100% vested under the new law.
rocknrolls2 Posted June 6, 2022 Posted June 6, 2022 It was my understanding that the SECURE Act change regarding long-term part-time employees was not directly a vesting change. The requirement is merely to make them eligible to make elective deferrals to the plan. Elective deferrals have always been required to be 100% vested at all times. The employer is not required to make a matching contribution with respect to elective deferrals for such employees. However, if it does, it is not required to provide any more vesting than that which is provided to matching contributions made on behalf of full-time employees.
Pam Shoup Posted June 6, 2022 Posted June 6, 2022 The Long-Term Part-Time employee rules do not (currently) go into effect until 2024. You use the plan's provisions now for eligibility to make contributions and receive the match. Vesting provisions would also follow the plan rules. It is my understanding that the rules are not completely clear on vesting for any employer contributions for LTPT ees once the LTPT provisions go into effect. I believe that we are waiting on further guidance on that issue. Pamela L. Shoup CEBS, RPA, QKA
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