Controlled Group Issue

[Guest San Diego Benefits Guy]

I was wondering if a controlled group existed in this situation. I wanted toi understand this before I moved on to the ASG rules. The facts are set forth below:

Corporation A - 91% owned by ESOP (all shares allocated to Individual A, sole participant in ESOP) and 9% to Individual A.

Corporation B - 100% owned by Individual A, no employees except Individual A.

Corporation C - 100% owned by an irrevocable stock trust, no employees except Individual A

LLC - owned 51% by Corporation B and 49% by a truly unrelated 3rd party. Several employees work for LLC.

I guess I have two questions.

If 91% of stock in Company A is held in an ESOP, but allocated to A's account, is A treated as owning 9% of Company A or 100% of Campany A. I think the answer is 9%.

Are the employees of A required to be considered in determining if ESOP meets coverage and participation tests? I think the answer is no, as only 51% of the LLC is owned by A.

Thanks in advance for your comments.

Ed

[Ron Snyder]

1) 100%. not 9%

2) CG = Corp A, Corp B, ESOP and Ind A, so yes