Forfeiture Prior to Extinguishing Distribution of Account Balance or Accrued Benefit and Prior to Five Consecutive Breaks in Service or Periods of Severance

Perhaps governmental plans lack the requirement to allow for five (5) consecutive periods of severance/year breaks in service to forfeit amounts where an extinguishing distribution of the accrued benefit or account balance has not occurred. Please provide helpful citations for this inquiry. 

The Employee Retirement Income Security Act of 1974 does not govern a governmental plan.

If a governmental plan’s sponsor seeks the Federal income treatment of Internal Revenue Code § 401(a), § 401(k), § 403(b), or § 457(b), a condition about nonforfeiture varies with the particular subsection one seeks to meet. Those conditions often involve a different rule, transition rule, or variation for a governmental plan. Some Federal tax law conditions relate to law as in effect on September 1, 1974.

Consider also that a governmental plan is governed by the State’s constitution, statutes, and other State law, which, under some States’ laws, might include a political subdivision’s law.

For more information, read Governmental Plans Answer Book https://law-store.wolterskluwer.com/s/product/governmental-plans-answer-book-pension3-mo-subvitallaw-3r/01t0f00000J4aDTAAZ.