Controlled Group?

[richard]

Husband H is a 50% owner of business X. Unrelated person A owns the other 50%. There are several employees.

Wife W is a 100% owner of her own sole proprietorship Y; there are no employees.

X and Y are completely unrelated with no overlap of employees, work, etc.

Both Companies are in California (Community Property State).

Question: Are X and Y within the same controlled group? (i.e., can the wife have a pension plan without affecting or being affected by what plan her husband's business has?)

[Guest ERead]

Being that both companies are in California, I'm assuming that the couple live in California as well. So - we can revise your statement by including both Husband and wife in the ownership %'s. In my opinion, based on the %'s given - their isn't control in company X. Then again - I'm not an ERISA attorney, you may want to have counsel review all the facts and circumstances.

[Dave Baker]

Toss this one at Derrin Watson of Goleta, CA and see what he comes up with ... http://www.benefitslink.com/qa_columns/who...yer/index.shtml (click) ... maybe he'll answer it online in the BenefitsLink Q&A column he writes on controlled groups and other "Who's the Employer" issues.

Come to think of it, he's already answered a coupla questions like this one ... he'd probably say there is no controlled group unless the couple has one or more minor children! See his column for that rather amazing but hard-to-argue-with analysis.

[This message has been edited by Dave Baker (edited 03-06-99).]