AlbanyConsultant Posted August 1, 2024 Posted August 1, 2024 Got a call today from an eye doc who owns 100% of his practice (which will be an LLC taxed as a sole prop starting in 2024; previously it was an S-corp where he owned 100%), looking to put in a new plan. He also owns ~21% of a surgery center where he performs all his surgeries (so I would say that, yes, he refers his business there). This immediately made me think of ASG. Doc is convinced that this isn't a problem. "The other doctors/owners of the surgery center have plans that cover only their practices and not the surgery center employees, so I'm sure it's fine." Without meaning to disparage any other potential TPAs working on those plans, I think I'll look at it with fresh eyes... So, we don't have a management ASG. Good. For a B-Org, I don't know the relative revenue numbers, but I'll assume that if my doc owns 20%+, it means his revenue is at least 10% of the practice. I suppose you could argue if the surgery center employees perform services that were 'historically' done by a doctor's office; I might argue they were historically done at a hospital. I think the A-Org argument is even stronger, as they are definitely 'regularly associated'. Oh - and of course doc owns his building as a R/E LLC... and his brother owns a lens shop in the building. "I don't specifically refer people there; they can go anywhere... but I tell them it's easy to go right across the hall to get their prescription filled." I think that is separated enough to not be a problem. I know that the best answer is "consult with an ERISA attorney", and that will be my ultimate recommendation. But I want to at least see if it can be ruled out so we don't waste our efforts and resources going down that direction if it's clearly NOT one. Is that what I've got here? Thanks.
John Feldt ERPA CPC QPA Posted August 2, 2024 Posted August 2, 2024 23 hours ago, AlbanyConsultant said: Doc is convinced that this isn't a problem. "The other doctors/owners of the surgery center have plans that cover only their practices and not the surgery center employees, so I'm sure it's fine. Doctors can be wrong? Yes, have them engage an ERISA attorney and wait for the doctor to say “But that’s not fair!” - which was the funniest thing I’d heard that day. Bill Presson and Luke Bailey 2
AlbanyConsultant Posted August 7, 2024 Author Posted August 7, 2024 You will be shocked to find that the doc is not happy that be might be part of an ASG. "I read up on it this weekend" - great; I've been reading about it for 30 years and it's still really complicated. "I'll open a SIMPLE IRA instead and forget this!" Buzz! Sorry, also subject to ASG rules. I don't think I'm getting this business. Luke Bailey and Bill Presson 2
truphao Posted August 7, 2024 Posted August 7, 2024 Been there on several occasions. Normally I would send the docs an “easy read” on ASG from ASSPA and a hard one from IRS and point out a few most relevant slides with a closing recommendation to engage an ERISA council. It is what it is. Luke Bailey 1
Gina Alsdorf Posted August 21, 2024 Posted August 21, 2024 https://www.irs.gov/pub/irs-tege/epchd704.pdf Have you checked out the IRS manual, if you look on 7-46 there is an ASG flowchart. I like it. Peter Gulia and Luke Bailey 1 1
AlbanyConsultant Posted August 21, 2024 Author Posted August 21, 2024 I knew I had seen this before, but couldn't find it! Thanks!
Recommended Posts
Create an account or sign in to comment
You need to be a member in order to leave a comment
Create an account
Sign up for a new account in our community. It's easy!
Register a new accountSign in
Already have an account? Sign in here.
Sign In Now