Partnership change - amend or new 125 plan

[Guest cshade]

I'm a TPA that administers 125 plans. I have a partnership that has a 125 plan. I've been notified that the partners have changed (one partner left, another came on) so there is a new name, and the partnership has a new tax ID number. All other group info remains the same. Do they need a new 125 plan, or just amend the current plan? Thanks for any direction.

[J Simmons]

You could amend to change whom the sponsoring employer is, switching the new partnership for the old one as the sponsoring employer. I'd have signatures for both partnerships on the amendment.

However, if I were a partner in the new partnership, I would want a new, different 125 plan so that we don't have any problematic history of the documents or operation that might attend the old one.

BTW, the partners themselves are not eligible to participate in the 125 plan, just the non-partner employees, right?

[Guest cshade]

Thank you for your response. I tend to agree with you on a new 125 plan, even though an amendment would be easier. I'll see what they want to do. No the partners do not participate, just their employees.