"414(n) gets into all the rules about leased employees, and the Code sections it applies to.... and doesn't mention 403(b).
So I'm wondering whether the time that an employee worked for a leasing agency would ever be considered for the plan sponsor's 403(b) plan because the leased employee rules wouldn't apply.
And this article from Plan Sponsor magazine seems to support that theory:
But then I happened to come across IRS Pub 7003 (revised June 2021). On page 2, it specifically says....
'Unless the plan provides that all leased employees within the meaning of section 414(n)(2) of the Code are treated as common law employees for all purposes under the plan, a determination letter issued with respect to the plan's
qualification under section 401(a) or 403(a) of the Code will be a determination as to the effect of section 414(n) upon the plan's qualified status only if the application includes:
1) A description of the nature of the recipient organization;
2) A copy of the relevant leasing agreement;
3) A description of the function of all leased employees within the trade or business of the recipient organization (including data as to whether all leased employees are performing services on a substantially full-time basis) and whether services are performed under the primary direction or control of the recipient organization; and
4) If the recipient organization is relying on any qualified plan(s) maintained by the leasing organization for purposes of qualification of the recipient organization's plan, a description of such plan(s) (including a
description of the contributions or benefits provided for all leased employees which are attributable to services performed for the recipient organization, plan eligibility, and vesting).'
Am I getting twisted up in the legalese, or is this being contradictory? It sounds like this is saying that the 403(b) plan has to comply with 414(n).... but 414(n) itself doesn't reference that 403(b) plans have to subject to it."