Which of the following statements concerning vesting under qualified retirement plans is (are)true?
I.The same vesting rules apply to defined benefit plans and defined contribution plans.
II.Employer contributions to a defined contribution plan must vest faster than employer contributions to a defined benefit plan.

Question

Quizplus · Accepted Answer

Statement I is false because vesting rules are different for defined benefit plans and defined contribution plans. Statement II is true because under ERISA, employer contributions to a defined contribution plan must vest no later than the completion of three years of service, while employer contributions to a defined benefit plan may be subject to a longer vesting schedule.

Which of the Following Statements Concerning Vesting Under Qualified Retirement