Special vesting rules apply to qualified defined contribution plans wi

Special vesting rules apply to qualified defined contribution plans with voluntary employee contributions and matching employer contributions. Which of the following statements is (are) true with respect to these vesting rules?

I. Employer contributions must vest immediately.
II. Graded vesting is permitted, and employer contributions must be 20 percent vested after 2 years, with an additional 20 percent vested in each of the next 4 years.
A) I only
B) II only
C) both I and II
D) neither I nor II

ANSWER

Answer: B