Tom Posted April 18, 2024 Posted April 18, 2024 A large investment company plan/record keeper initiated a forfeiture in Feb 2024 for a participant who terminated in 2018. This participant never took a distribution from her account and was 20% vested in her profit sharing source. The record keeper initiated an 80% forfeiture of her profit sharing. I know a plan can have a provision to forfeit a zero % vested terminated participant. This participant also has elective deferral and safe harbor match sources. I did limited research within the plan's basic document but didn't see anything right off. I assume there is some such provision to allow for this as I highly doubt this record keeper would not do this correctly. Thank you for any comments
Popular Post Mr Bagwell Posted April 18, 2024 Popular Post Posted April 18, 2024 Look for the term "Forfeiture Break in Service" in your plan document. That's what ours uses. After 5 Breaks in Service the non-vested funds are forfeited. I'd guess the first Break in Service was 2019. Forfeiture in 2024 is right on track. Bri, CuseFan, Bill Presson and 3 others 6
Tom Posted April 19, 2024 Author Posted April 19, 2024 Thank you - I couldn't think of the document term offhand.
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