SARSEP adobted before 12/31/1996 but not funded

[Guest jschoolman]

An employer formally adopted a SARSEP before 12/31/1996; however, no employee contributions were ever funded. Now, there are employees that would like to contribute to the SARSEP. Can the employees do so even though SARSEPs were repealed by SBJPA'96?

[Appleby]

Absolutely

SARSEPS established by 12/31/1996 were grandfathered and are still in effect unless it was terminated

[Guest Don J. Smith]

I'd take caution here. There is a definite argument that since the plan was never funded that it didn't really exist. Personally i'd advise against it. There are better alternatives.