Corp/plan sponsor is owned by 2 individuals; becomes partnership owned by the two individuals' corps; can corporations participate in the partnership's retirement plan?

[Gilmore]

I'm not sure if this is the right forum for my question, but here goes...

Our client was a corporation owned by two individuals, 51% and 49%. They have changed the entity to a partnership. The partners are individual corporations. Each corporation is owned by one of the original shareholders of the original corporation. One corporation owns 51% of the partnership, the other 49%.

The only income of each new corporation is the partnership income.

My question is, are these three entities related?

We would like to continue the current plan but are not sure if the two corporations can participate in the partnership's plan as related employers.

Thanks.

[R. Butler]

Corporations share is attributed to the shareholders. Probably have a controlled group. Are original individuals sole owners of their corporations? If not what is the ownership of each corporation?

[Gilmore]

R,

Thanks for responding. Yes, the original two shareholders now are the sole owners of their own individual corporation. It is the two new corporations that own the partnership 51% and 49%. I'm assuming the only income that the corporations earn is the income from the partnership.