Contribute to own retirement swhen office sharing

[Guest booziboy]

I am posting this question as rookie and dont know much about the tax code.

I have a medical practice(formed as LLC single owner) and have no employees.

I share office space with another physician (call him physician B)

Physician B employs both the support staff(who do admin work for both of us)

End of the month i just pay the other physician an "overhead check".

I have my own accounting, revenue stream, pay my seperate taxes etc.

Physician B has no retirement plan and so does not provide one for his employees.

I was to contribute towards my retirement every years and I believe I can almost put in $49K (including profit sharing). But my CPA says that I cannot until we fun the retirement of the Physician B employees. I have tried talking to the other physician and he is not interested in getting into the mess of providing retirement etc.

What is the IRS code that is preventing me from contributing to my retirement. I believe something called code 414(m) about discrimination of employees.

I would people to provide me with some second opinion or ideas.

Thanks

[Bird]

It sounds to me like they are "shared employees" (and your CPA is right about needing to cover them, or at least consider them in testing, which will lead to covering them). The cites I know of are ancient revenue rulings, 73-447 and 67-101 (I don't actually know this stuff, just found the references in a book).

FWIW, physician B does not have to have a plan covering them; you could have a plan and cover them for your share. But you're talking about a whole 'nother level of complexity and cost to do that.

[Kevin C]

It sounds like shared employees to me, too.

We had a client with a similar situation, except that their employees received paychecks and W-2's directly from each doctor. The plan really wasn't that messy. The Plan counted all the hours worked, but only the compensation paid by the doctor sponsoring the plan.

[Guest booziboy]

It sounds like shared employees to me, too.

We had a client with a similar situation, except that their employees received paychecks and W-2's directly from each doctor. The plan really wasn't that messy. The Plan counted all the hours worked, but only the compensation paid by the doctor sponsoring the plan.

anyway we can structure it so that we appear as "not shared".

[Bird]

anyway we can structure it so that we appear as "not shared".

Probably, but the fact remains that they are shared.