Dissolving sponsor

[k man]

is anyone aware of an exemption to the 100 participant rule for simple plans if the sponsor is dissolving or winding down?

[Gary Lesser]

All that can be said is that they can eventually maintain a SIMPLE IRA in the year after they get small enough. The 100 employee limit is based on the previous year census (and the $5,000 threshold if provided for).

Although not indicated in your facts, Code Section 408(p)(2)© provides a grace period for employers that grow too large due to an acquisition, disposition, or similar transaction by an eligible employer.