MEP's

[Belgarath]

Suppose you have corporation A, which sponsors a plan. Corporation B is formed, and is owned 70% by Corporation A, and 30% by an unrelated investor - no options, etc., so not a controlled group. (nor is it an ASG)

Corporation B is very small, and the owners of A want to just include B's employee's in A's plan.

Their pre-approved document contains multiple employer provisions, so they can sign on as a participating employer - no problem there. Question is, does a separate 5500 form need to be filed for each?

This doesn't appear to be an "open" MEP as discussed under AO 2012-04A, and given the 70% ownership, it seems like this should be sufficient to consider it as one plan for 5500 purposes?

Any thoughts? I realize this is a matter for legal counsel to determine, but I'd like to formulate some thoughts before it reaches that stage...

Thanks.

[chc93]

We have the same situation. Corp B signs on as a participating employer to Corp A's plan. One 5500 with "multiple-employer plan" checked in Part I A, and attached a list of the participating employers as noted in instructions. Note... small plan (<100 participants).

[Belgarath]

Thanks. In this case, Corp. A's plan is a large plan requiring audit, so we're also going to ask the auditing firm to see if they have any problem with it.

[Bill Presson]

Belgarath: Asking the auditing firm if they have any problem with it presumes they will know what they're talking about. Unfortunately, I haven't found that to be the case with the majority of CPA firms.

Since the two firms in the OP's example have a relationship, I'm not aware of any issue with it being considered a single plan

[Belgarath]

Thanks Bill. Yeah, in addition to just the ownership, Corporation B also gets about 2/3rd of its business from corporation A, so it seems fairly safe.