63. Vesting break in service - one year holdout

Statement of Requirement: IRC 411(a)(6)(B)

Document Provision: _____

Sample Plan Language:

In the case of any participant who has incurred a 1-year break in service, years of service before such break will not be taken into account until the participant has completed a year of service after such break in service.

(Note to reviewer: A fully insured plan that satisfies the requirements of IRC 411(b)(1)(F) may use the break in service rule of IRC 411(a)(6)(C) and disregard years of service after 5 consecutive 1-year breaks in service for purposes of determining the participant's nonforfeitable percentage in his or her accrued benefit derived from employer contributions that accrued before such breaks in service. However, the participant's years

148 | Defined Benefit Plan LRM Package 06/2026

of service before the breaks in service must be counted in vesting the postbreak accrued benefit unless the plan uses the rule of parity and the pre-break years of service for nonvested participants could be disregarded pursuant to such rule. See LRM #64.)