FIS Relius

Among the more challenging eligibility questions that confront retirement plan practitioners are questions relating to rehired and part-time employees. When does a rehired employee re-enter/enter the plan? Can a plan exclude part-time employees? How may the plan define part-time employees? When and how do the break-in-service rules affect rehired and part-time employees? Does the one-year hold out rule apply to a 401(k) plan? What vesting years of service must the plan credit for a rehired employee? Does it matter whether the participant received a cash-out distribution? If the rehired participant is receiving distributions, do you stop the distributions? Surprisingly, these questions arise often. While these are frustrating issues in administration, they are also important considerations in plan design. Should the employer use break-in-service rules? How much good will they do? How much confusion will they cause?

• When do rehired employees re-enter/enter the plan?
• When and how do the break-in-service rules apply?
• Can you utilize the one-year hold-out rule in a 401(k) plan?
• When can the plan treat the rehired employee as a new employee?
• Distributions to rehired employees
• Crediting vesting service for rehired employees

There are no prerequisites or advance preparation for this program. The instructor will assume attendees are familiar with preapproved plan documents and with the operation of 401(k) plans.

NASBA Field of Study: Taxes

Objectives: After the seminar, attendees should be able to:

1. Determine when a rehired employee enters the plan
2. Apply the break-in-service rules correctly
3. Determine whether the break-in-service rules will benefit an employer
4. Determine when the plan may treat a rehired employee as a new employee
5. Determine how to administer the eligibility rules where there is missing service data

All ownership and intellectual property rights in and relating to this website and all of its contents or any copies thereof, including but not limited to copyrights, logos, trademarks, service marks, design, text, videos, sound recordings, images, links, graphics, code, concepts and themes are owned by FIS and/or its subsidiaries (collectively "FIS") or used under authorized license by FIS. Any recording, reproduction, transmission, distribution, publication, performance, broadcast, hyperlink, creation of derivative works or other use in whole or in part in any manner without the prior written consent of FIS is expressly prohibited. Without the prior written consent of FIS, you shall not insert a hyperlink to this website or any part thereof on any other website or "mirror" or frame this website, any part thereof, or any information or materials contained in this website on any other server, website or webpage.