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IRS FAQ: Employer Turnover Rate Might Not Be Impacted Where Employee Rehired in 2020 (IRC §401)

July 31, 2020, 5:00 AM

Employees who participated in a business’s qualified retirement plan, then laid off because of Covid-19 and rehired by the end of 2020, are generally not treated as having an employer-initiated severance from employment for purposes of determining whether a partial termination of the plan occurred, frequently asked questions posted to IRS website July 31 stated. Subject to the facts and circumstances of each case, participating employees generally are not treated as having an employer-initiated severance from employment for purposes of calculating the turnover rate used to help determine whether a partial termination has occurred during an applicable period, if they’re...

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