Terminate and Start a SIMPLE?

[pcbenefits007]

Having a hard time finding guidance on if an employer who successfully terminated their plan (Nov. 2013) can now establish a SIMPLE 401k for the owners only now (doctors) and then start a new 401k for all employees once the 12-month waiting period is up. Does the 12 month rule apply to SIMPLE 401ks as well?? Where does it say you can or can't?

Thanks!

[rcline46]

If you mean a Simple IRA, then yes they establish now. If you really mean a SIMPLE 401(k) then no. You cannot establish a new DC plan within 12 months after the last distribution (I think this is in 401(k)(6)).

[masteff]

for the owners only now (doctors) and then start a new 401k for all employees once the 12-month waiting period is up.

Are these current employees? You have very little room to exclude anyone from a SIMPLE (of either type); in short: under $5K comp, collectively bargained, nonresident alien w/ no US comp. See IRS Pub 560.