Multiple Employer 401(k) Plans

[Guest msearle]

Can anyone assist me with information concering Multiple Employer 401(k) plans? Do Employee Leasing companies use them? How do they differ from single employer plans?

------------------

[IRC401]

The major differences between a multiple employer plan and a single employer plan are:

1. You probably won't be able to use a prototype document.

2. ADP and ACP testing are done on an employer (per IRC sec 414) basis ( and your recordkeeper may not know how to do the testing).

3. The 5500 reporting is a little different.

The differences are significant enough that you should not set up a multiple employer plan unless you have a good reason to do so and are being advised by someone who understands the rules. NOTE that a multiple employer plan is not the same as a multiemployer plan.

[Guest msearle]

Would an Employee Leasing firm use this type of plan to provide a single plan, yet provide the option for client companies to use particular aspects of the plan that best fits them?

[Alf]

At the risk of getting off of the topic of this board (but not this message) does anybody know of any special rules or restrictions that would apply to multiple employer money purchase plans (as opposed to 401(k) plans). I am familiar with multiple employer 401(k) plans and the issues mentioned by IRC401, but the issue of multiple employer money purchase plans recently came up and I cannot find any differences.

[Guest msearle]

Question to IRC401:

On filing a 5500 for a Multiple Employer Plan, does the sponsoring employer file one form, or does each participating employer have to file as well?