I'm not real familiar with SIMPLE's but an employer has maintained one for 5 years, and has gone over 100 employees in 2004. They will use a 401(k) in 2005. Can the employer continue to actively fund the SIMPLE through the end of 2004, or does the employer have to stop in the month the company exceeded 100 employees?

The measure is as of the preceding calendar year. An employer who doesn't satisfy the 100 participant rule can continue to sponsor the SIMPLE for a two-year grace period. My read would be that if there were under 100 participants as of the beginning of 2004, you could continue to maintain the SIMPLE through the end of 2005.