Partial Plan Terminations

So, it is my understanding that the IRS, when calculating the "turnover" rate, considers all employees ELIGIBLE to defer as participants for purposes of calculating the participant numbers. The fact that the DOL has altered the definition of "participant" for purposes of 5500 counting does not affect this IRS stance. 

Anyone disagree, or have other thoughts? Thanks.

Great question and I agree with your opinion, unless IRS tells us otherwise. Thankfully the form has those counts in addition to the account balance counts.

The count of participants with an account balance as of the beginning of the plan year in a defined contribution plan is used solely for determining if an IQPA is required.  The count of participants as of the beginning of the plan year (e.g., Line 5 on the 5500 or 5a on the SF) is used for all other purposes that rely on a beginning of year count.

Thanks.