AndyH Posted October 3, 2002 Posted October 3, 2002 Is there any way, short of a formal coverage determination, that we can tell if a company is a professional service corporation exempt from PBGC coverage? Are there any indicators, other filing differences, etc.? At issue is a "consulting firm" run by an engineer with 3 or 4 employees that works for power companies. We are calling the PBGC, but I thought that others might have dealt with this before.
Guest Keith N Posted October 3, 2002 Posted October 3, 2002 The list of "professional individuals" listed in 4021©(2)(B) of ERISA includes "public engineers". I would argue that a group of engineers who are providing consulting services as their "principal business" would be considered a "professional service employer".
AndyH Posted October 3, 2002 Author Posted October 3, 2002 Thank you. I agree. But the PBGC told us on the phone that a "consulting firm" would not qualify. They said that the exemption would be for a physician office type of business structure. But in ERISA 4021 the exemption also applies for "draftsmen", "architects" as well as actuaries. But I guess they can't have consulting firms. Our public servants at work. Looks like we have to file the forms and request a formal written determination. Other thoughts are welcome.
david rigby Posted October 3, 2002 Posted October 3, 2002 How about taking the position that the generic business is "consulting", but the specific business service being provided is "engineering." Don't get hung up on references to "consulting". You could also apply that word to many things, including legal advice. I'm a retirement actuary. Nothing about my comments is intended or should be construed as investment, tax, legal or accounting advice. Occasionally, but not all the time, it might be reasonable to interpret my comments as actuarial or consulting advice.
Guest Keith N Posted October 3, 2002 Posted October 3, 2002 That's an interesting reply (I was replying to Andy, not PAX). Are they saying that "consultants" are not professionals? As I read 4021 I don't see the word "consulting" anywhere. It simply states that "the principal business of which is the performance of professional services" We don't file w/ PGBC for our firm (actuarial consulting), and I have several engineering clients who don't file either. At one phase of my career I had several "performing artists" as clients and non of them ever filed a PBGC form. You may want to run it past your clients ERISA attorney and ask them to make a recomendation. I don't think I would file with the PBGC just because of a phone conversation. We all know that government agencies don't have the most knowledgeable people answering questions.
Guest merlin Posted October 4, 2002 Posted October 4, 2002 Andy, I don't know who you spoke to at PBGC, but a lady named Nancy Martin has been helpful to me in the past.
AndyH Posted October 4, 2002 Author Posted October 4, 2002 Thanks, Merlin. Someone else in my office made the call, so I don't know; I'll find out and see if I can reach her.
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