I am working an a 401(k) plan that has 21 & 1 month for (k) eligibility and 21 & 2 years for (m) eligibility. For purposes of determining otherwise excludable, can I use the earlier of 6 months or first of next plan year following 21&2 or do I still have to use 21&1? I can see having to use 21&1 for ADP, but it seems that I could use 21&2 for ACP OE.

Reg 1.410(b)-7©(3) says to use "...the greatest minimum age and service conditions permitted under section 410(a)..." which leads me to believe that 21&2 is OK for ACP OE. Am I correct on this? If not, can you please provide a cite that prohibits it?

Thanks!

see 1.410(b)-6(b)(3)

..without regard to section 410(a)(1)(B)
this is the code section that deals with a 2 year wait

in otherwords, you can't apply otherwise excludable rule to a 2 year wait, only a one year wait.