Employer Eligibility Failure definition

Employer Eligibility Failure means any of the following:

Employer Eligibility Failure means the adoption of a plan intended to include a qualified cash or deferred arrangement and satisfy the requirements of § 401(a) or §403(a) by an employer that fails to meet the employer eligibility requirements to establish a § 401(k) plan. An Employer Eligibility Failure is not a Plan Document, Operational, or Demographic Failure.

Employer Eligibility Failure means the adoption of a cash or deferred arrangement (as defined in regulations under □ 401(k)) intended to satisfy the requirements of □ 401(k) for one or more years between 1987 and 1996 (inclusive) by an employer that was a tax-exempt organization prohibited from adopting a □ 401(k) plan during that period. An Employer Eligibility Failure is not a Plan Document, Operational, or Demographic Failure.

Examples of Employer Eligibility Failure in a sentence

• An Employer Eligibility Failure is not a Plan Document, Operational, or Demographic Failure.

• The term "Operational Failure" means a Qualification Failure (other than an Employer Eligibility Failure) that arises solely from the failure to follow plan provisions.

• The term "Demographic Failure" means a failure to satisfy the requirements of § 401(a)(4), § 401(a)(26), or § 410(b) that is not an Operational Failure or an Employer Eligibility Failure.

• A Plan Sponsor may use VCP general procedures, VCT, or VCSEP to correct an Employer Eligibility Failure.

• However, under sections 4.01, 4.02, and 10, SCP, VCO, and VCGroupSCP and Group Submissions under VCP are not available for a Plan Sponsor to correct an Employer Eligibility Failure.