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October 15th, 2024
Information & Insights for the 403(b) Community
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Ask the Experts
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How Do New Long-Term, Part-Time Rules Apply to Student Employees in 403(b) Plans?
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Q: We are a private university that sponsors an ERISA 403(b) retirement plan. We are a bit concerned with the new Long-Term Part-Time Employee rules that will apply to 403(b) plans, beginning in 2025, as we currently exclude student employees (under the current student employee classification exclusion in section 403(b)(12)(A) of the Internal Revenue Code) from participating in our 403(b) plan for all purposes. If eligibility as an ERISA LTPT employee will now need to be tracked for such students, it will present a significant administrative burden for our institution, never mind the fact that we currently have no operational mechanism for such student employees to make elective deferrals into the 403(b) plan. Will the new rules require us to allow any student employee to defer to the 403(b) plan?
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