Non-discrimination testing for a controlled group where each member sp

[Guest]

I have a controlled group consisting of corporation A,B,and C,each of which sponsors its own plan for its own employees. None of the cg members costitutes a QSLOB,so my coverage,participation,and non-discrimination testing must be done on group-wide basis. My understanding of the testing process is that I'm testing on a "per plan" basis,i.e.,in testing Plan A, I'm only considering those non-excludable employees of Co. A who accrued a benefit or received an allocation as "benefitting". The employees of Cos. B and C are considered as not benefitting under Plan A,even though they they are benefitting under their own respective plans.Is this the correct way to perform the coverage and (if applicable) the participation tests.

A second question: If Plan A,B, and C individually are safe-harbor plans,is my testing complete? Or must the accrual/allocation rates be tested regardless?

[Guest]

It sounds like your lumping lots of things into your "testing". In general, there are 3 main Code sections which must be complied with. The first, 401(a)(26) is fairly straight forword, just a matter of counting.

The next will probably be your most complex, 410(B). This tests if the employer is covering a sufficient percentage of the workforce in the qualified plans which they maintain. Each of the plans of the controlled group would have to meet these tests individually considering the entire controlled group as the employer.

IF you get through 410(B), it sounds like you should sail through 401(a)(4) since you said they are all "safe-harbor" plans - by which I assume you mean 401(a)(4) safe harbors which test the benefits delivered, not the employees covered.

These tests can be extremely complex, so be careful.