PBGC Coverage - Affiliated Service Group

[Effen]

A doctor's practice and his wife's business are determined to be an Affiliated Service Group.

The doctor's practice is considered a "professional services company" and his wife's business is not.

The group sponsors a pension plan with 10 participants (8 with physician, 2 with wife).

Are they exempt form PBGC coverage under the professional service exemption, or because the wife is not a professional service company they would not be able to meet the exemption?

What if we excluded the wife's company from participation?

[SoCalActuary]

If you want to exclude the 2 employees, and that produces a non-discriminatory practice, then you can probably avoid PBGC coverage.

Otherwise, you should submit the facts to the PBGC for a determination. Anything else is probably just speculation.

[Effen]

Good idea. Spoke to the PBGC and they confirmed the group would be covered.

[david rigby]

Spoke to the PBGC and they confirmed the group would be covered.

I'm shocked. Shocked!

[John Feldt ERPA CPC QPA]

Might be a good thing - no 404(a)(7) limitation if you're PBGC covered.

[Effen]

That is really the point. We wanted to make sure that we were covered so we could take a higher deduction.