Is this a multi-employer plan?

[Jilliandiz]

Company A has a profit sharing plan. Company B decides to adopt Company A's profit sharing plan. Therefore, both A & B are depositing employer contributions into one account, filing 1 5500, but 2 separate corporate tax returns......is this considered a multi-employer plan????? I don't know what to do about marking the 5500???

Thanks.

[Jilliandiz]

The 2 companies are also unrelated!!!!

[Guest jfp]

If they are "unrelated" in both the ownership sense and the "affiliated service group" sense, then it sure sounds like you have plan that is described in the 5500 instructions as a "multiple-employer (other)" plan. Not a "multiemployer" plan, but "multiple-employer (other)" plan.

However, tell us more: why are they doing this, instead of having their own plans?

[Guest BenefitsLawyer]

It's almost certainly not a multiemployer plan--in order to be a multiemployer plan, there must be a collective bargaining agreement that requires the contributions and the plan must have a joint board of trustees appointed by the union and the employers' representatives. I agree that it's probably a "multiple employer-other."

[Jilliandiz]

The 2 companies are owned by the same person...does that change anything?

[Guest jfp]

It sure does: it is a "single employer plan," not a multiple-employer plan."

[Guest b2kates]

How can they be unrelated, if they are both owned by the same person.

Seems to be a controlled group.