Teatree

I am not in the advisory or consulting business. I am actually a potential client just doing some legwork research to learn as much as I can about 401(k) issues and pick some brains, but thanks for your gracious advice.

Thanks Bill. Any way you can expand on what type of plan design elements would permit this or what some of the considerations are? I am a newbie. From what I have read so far, it seems that the company would be able to set up the 401k plan just for its employees, but that it would have to count all employees in brother sister controlled group when discrimination testing. However, if the company set up a safe harbor 401k plan just for its employees, controlled group considerations and discrimination testing would be non-issues. Perhaps my understanding is off base?

I am not sure how 401(k) plans works, so hoping for any guidance. Apologies if question is basic. Several companies are in the same brother sister controlled group. None has ever had a 401(k) plan. One of the companies wants to set up a 401(k) plan that would cover just its employees. Can that company do that or must the plan allow participation by employees of other brother-sister companies? Also, assuming that the company can set up a 401(k) plan to cover just its employees, would discrimination testing be done on just that company's employees or must it include employees from all the other brother-sister companies? Thanks.

Thank you for confirming what I suspected about the filing! And yes, I am talking about the annual section 125 cafeteria plan discrimination testing if anyone has thoughts/advice. The two separate 125 plans were set up for the purpose of allowing pre-tax deduction of employee premium contributions.

Four entities are in same controlled group/affiliated services group. 3 of the entities participate in one fully insured wrap welfare benefit plan (medical,dental, premium only plan). All insurance contracts for that plan are signed by the plan sponsor (i.e., one of the 3 entities). Since this plan had 140 participants at start of plan year, my understanding is that we will need to file Form 5500 for it. The remaining entity has its own separate fully insured wrap welfare benefit plan (medical, dental, premium only plan ). This entity is the plan sponsor and all insurance contracts are signed by it. There are only 22 participants at start of plan year. Does a 5500 have to be filed for this plan too, or is a 5500 not required for this plan until the plan reaches 100 participant threshold at start of another plan year? Related question: For annual discrimination testing, do you have to aggregate all the participants from both plans together or can you test separately? Thank you for any input .