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Controll group, average benefit test, and ADP test


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One company acquired another company. Each company has its own 401(k) Plan. The client wants to perform ADP testing on each plan separately. The Plan of the acquired company fails the ratio percentage test (performed on a controll group basis). The average benefit test does pass. However, as required, all plans of the employer are taken into account.

That being the case, can the ADP test be performed separately for each plan?

Thank you!

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