Is 2 year wait an issue for a new plan?

[Jakyasar]

Hi

Did a proposal for 2022 for a one lifer. They said to go ahead, asked for w-2 and when I got it, there were 2 listed.

CPA said the other was part-timer and terminated in 2022. Insisted on DOH and DOT.

Surprise surprise, DOH early 2021 with DOT late 2022. I asked for hours and of course, full-time employee.

Can set up the plan with 3 year cliff and/or 2/20 with no prior service before 1/1/2022 aka effective date of the plan. Not sure how the partial termination would play here as employee is not replaced. What do you think on this?

The question here: Is it ok to set up the plan now with 2 year wait (100% vesting is not an issue as it is only the owner)?

This is unchartered territory for me and not sure about discrimination issues.

Thanks

[Bri]

Sounds absolutely smart to set it up with a 2-year wait.  And it buys you time if there's someone later hired to replace whoever that other person was.

I suppose, make sure the owner has 2 years herself in this enterprise.

[Belgarath]

You don't say if elective deferrals are part of the plan. You can't have 2 year eligibility for the deferral piece.

[Jakyasar]

I am only concerned about DB and PS. Cannot have retro deferrals anyway.