Client moved to PEO, termed prior plan, moving out of PEO starting new plan in less than 12 months

[AlwaysLearning]

I have a client who terminated their existing plan and transferred to a PEO.  A final 5500 Form was completed with a short plan year from 1/1/2018 to 6/11/2018 (I'm assuming this is the date all assets were transferred to the PEO plan with the plan number as 001). 

The client now wants to move out of the PEO and start a new plan sponsored by his company (same EIN as the prior plan) under plan number 002.  Since the last distribution date of the  terminated plan of the Plan Sponsor is less than 12 months, is there a successor plan issue, if the effective date of the new plan is 1/1/2019?

FYI - This is not a safe harbor plan.

If this is a successor plan issue, is the resolution to have a short plan from 7/1/2019 to 12/31/2019?

Thank you for any input.

 

[shERPA]

Seems to me the successor plan distribution issue already exists - from adopting the PEO plan. 

[AlwaysLearning]

To clarify, all assets were transferred to the PEO plan.  The 5500 form indicates there was a resolution to terminate the plan, so I'm not sure what documentation was prepared to document the transfer, but there were no distributions paid to the employees all assets were transferred.

[shERPA]

OK, so there haven't been any distributions.  Wasn't sure what "distribution date" you were referring to.  Is the PEO plan distributing to ees?  Then have to wait 12 months.  Or set up new plan and transfer back from PEO.  Successor plan is OK as long as restricted monies aren't distributed to current employees under 59-1/2. 

[AlwaysLearning]

"Distribution Date" definition was meant to indicate the distribution of all assets out of the plan to indicate a final 5500 date.   All assets are being transferred to the new plan and there will be no distributions to any current participants.

Thank you so much  for the clarification!