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I'd say no change.

Which even if 1, 2 and/or 3 apply and it is a CG, I believe pension legislation under consideration could change that in the future (probably only for 2 and 3 is my guess). So this could go from CG to not CG w/o anything (other than law) changing, just be aware. Also, if using a vendor's branded "solo k" product, make sure it allows for other participating employers.

was due a reasonable amount of time (usually 30 days) before the 2022 plan year, e.g. November 30, 2021.

What is the correction they're looking to make? Do they want to not have to make an allocation to the former employee? The 3% safe harbor is probably required no matter what, but they might be able to get away without the 2% profit sharing if the allocation formula in the plan document says that each participant is in their own group, and if all the testing passes without it. If they do want to still give the former employee the 2% profit sharing for 2021, then go ahead and do it now. The last date to make a contribution that can be counted as an annual addition for 2021 is 30 days after the employer's tax filing deadline for 2021, including extensions. As you noted it would be deductible for 2022.

You would treat it as a reduction to the value of benefits expected to be paid out. The instructions for the standard termination filing discusses the election to forgo receipt of benefits (don't call it a "waiver") for line 7 of the EA-S, under the heading of "Plan Amendments."

I'm assuming this is a calendar year plan. Did you meet one of the exceptions to continue to be treated as a safe harbor plan in the year of termination since it is less than 12 months?

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I suppose they'd need to check off all the usual "not a controlled group" boxes - 1 - the usual noninvolvement rule between the businesses 2 - no minor children 3 - not a community property state Obviously the first one there is one they can control most easily if there's a specific desired outcome to the CG determination.

Welcome! This page might provide a starting point. Some years ago, Groom Law Group maintained a list ... but I haven't seen an update in quite a while, probably due at least in part to the exponential growth in the number of cases. @Peter Gulia might have some ideas.

Yea this is the answer I'm looking for as well. I have never been a fan of the "attach a statement saying the audit isn't ready just to get it through EFAST" approach, but the fact that DOL has to give you 45 days to fix it has had me use it on occasion. If the DOL is sharing their data with IRS (who is not required to hive 45 days) that really does change things up a bit. I don't mind a change, I just want to know best practice of addressing the issue going forward.

One more thought -- ethical and practical issues. For example, did you ask about other companies that might be in the controlled group, but the client lied to you, which you only found out about later. I actually had that happen to me once and it was not a pleasant experience -- I'll leave it at that.

First you say multiple companies of which the client is 100% owner, and then you say just two, with the client owning 100% of one and 50% directly of the second. This is as I understand you. Facts actually matter, so gather all the facts. Then, if necessary, read the controlled group code and reg provisions, including the attribution rules. You may need to dig into other IRS "guidance" and the case law. This could be a very messy situation, but hopefully not.

I do believe that the maximum Compensation limit for the year of $305,000 will need to be pro-rated for the short plan year period. If it is a non-Safe Harbor plan, this could effect the results of your testing.

Yes, the 402(g) limit is a calendar year dollar limit. So the fact that the plan is terminating mid-year doesn't alter the maximum dollar deferral allowed.