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Compensation for Term EE.


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Guest moltengator
Posted

Law firm is a partnership owned by two partners - Partner A-50% & Partner-B 50%.

Partner A also owns 100% of P.A. which is an S-Corp.

Partner B also owns 100% of P.A. which is an S-Corp.

Non-Partner C owns 100% of P.A. which is an S-Corp.

Non-Partner D owns 100% of P.A. which is an S-Corp.

The Partnership sponsors a safe-harbor 401(k) plan which is treats all four S-Corp.'s as affiliated employers. The safe harbor is a 3% non-elective.

Non-Partner C is no longer affiliated with partnership. Leave on March 31, 2004. Does he have to receive safe-harbor non-elective for 2004? If yes, is it based on his W-2 compensation from his S-Corp. for the period 01-01-2004 to 03-31-2004? He does not get paid from the partnership.

Posted

First off, why is C in an affiliated service group if it does not own any portion of the partnership?

Hasn't C's corporation adopted the plan? And C hasn't terminated from the C corporation has he? Does C wish to continue the plan for its employees?

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