Retirement, LLC
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Bates & Company
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Retirement Plan Legal Specialist Pentegra
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Nova 401(k) Associates
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Central Pension Fund of the IUOE
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Defined Benefit Calculation Specialist/Actuary The Angell Pension Group, Inc.
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Compass Retirement Consulting Group, Inc.
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Retirement Plan Relationship Manager ERISA Services, Inc.
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Carpenter Morse Group
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Trucker Huss, A Professional Corporation
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United 401(k) Plans, Inc.
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Central Pension Fund of the IUOE
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Nicholas Pension Consultants
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Prime Pensions, Inc.
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Question 272: We have a situation that appears to be a ASG. My question concerns the FSO, which is an LLC (a title company) wholly owned by another LLC (a home builder) in which capital is a material income-producing factor. For tax purposes, the FSO is treated as a "disregarded entity"; its operations are included in the tax return of the parent. Because the FSO is treated like a division of the parent for tax purposes, can we so treat it in determining ASG status? If this service organization actually were a division of a manufacturing or other unincorporated company where capital is a major income-producing factor, should we look at that division on its own to determine whether we have an ASG (or can we assume we don't since it is just a small part of the parent's operations)? |
Answer: The second paragraph of your question makes your point eloquently. I concur. Let me elaborate with references to my book, Who's the Employer?. (Subscribers can click to view online the text of references to sections in the book.) |
Answers are provided as general guidance on the subjects covered in the question and are not provided as legal advice to the questioner or to readers. Any legal issues should be reviewed by your legal counsel to apply the law to the particular facts of this and similar situations.
The law in this area changes frequently. Answers are believed to be correct as of the posting dates shown. The completeness or accuracy of a particular answer may be affected by changes in the law (statutes, regulations, rulings, court decisions, etc.) that occur after the date on which a particular Q&A is posted.
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