Who's the Employer?

[12AX7]

I hope this gets explained correctly, but I'll give it my best shot. I have a client with a 401 (k) Plan. The other day I get a call from "an employee" of my client that wants to enroll in the plan and I cannot locate this guy on the plan's census. This client manages real estate properties and the "employee" actually gets paid from a condo association of the property that is managed by the client. His paycheck comes from the association, but he is managed by my client as part of the agreement with the association. There is no employee leasing agreement. There are no related group issues.

It appears to me that this individual is an employee of the condo association, but I need to be reassured of that fact. Should there be any other questions that I need to ask my client, or is it clear that he is not an employee of my client.

[Guest SloWorker]

Company 1: Real Estate Management

Company 2: Condo Association

Company 1 owns the 401k plan. Company 2 employs the individual.

If there are no affiliated/control group issues and the employee is not leased (or the plan excludes leased employees) then I don't see him as a participant either. However, I would ask your client, Company 1, why the employee called to enroll in the first place

[12AX7]

He called because he knew the management company had a plan and thought he could enroll. Sometimes the line between employer/employee is a little blurred. I will approach the association and make recommendations to adopt a plan.