PEO Plan Status

I am not heavily involved in the PEO, MEP, PEP, etc. field, so would appreciate any input here.

I've come across a few large PEO plans that treat their 401(k) plans as multiple-employer plans on their 5500s. They generally report as a multiple-employer plan and file the schedule of contribution allocations for participating employers.

I recently came across one that, on its 5500, says it is a "single employer plan which is operated consistently with the requirements for a multiple employer plan...". The 5500 is marked as a single-employer plan and there is no list of contribution allocations for participating client organizations. Plan design elections and compliance testing is done on a client organization/participating employer basis. 

Am I missing a nuance between a multiple-employer PEO plan and a single-employer PEO plan that is treated as a multiple-employer plan?

Appreciate any clarification.

The filed Form 5500 report is a public record.

Unless your client is the PEO or some investment or service provider named in the report, you might attach the report here without revealing a secret or confidence of your client.

Reading the report might help us consider whether there is some reasonable interpretation to support the reporting you observed.

Sure, the particular one I asked about is the Insperity 401(k) Plan. The large pdf is giving me a hard time, but it's easily accessible on EFAST.

It's marked as a single-employer plan in Part I of the 5500 (page 1) and describes its status on the last page.

Compare that with, for example, the ADP TotalSource PEO 401(k) plan that reports as a multiple-employer plan and lists every participating organization and their relative contributions. 

The Form 5500 report’s attachment you mentioned states: “The lnsperity 401(k) Plan is a single employer plan which is operated consistent with the requirements for a “Multiple Employer Retirement Plan” as defined in Revenue Procedure 2002-21. Revenue Procedure 2002-21 defines a “Multiple Employer Retirement Plan” as a defined contribution plan (including a plan that includes a cash or deferred arrangement described in section 401(k)) intended to satisfy the requirements of section 401(a) or section 403(a), and section 413(c), under which each Client Organization is “treated as” an employer.”

It seems Insperity might assert that the plan is a multiple-employer plan within the meaning of the Revenue Procedure’s special definition, but is not “a plan maintained by more than one employer” described in Internal Revenue Code § 413(c) and is not other than a single-employer plan defined in ERISA § 3(41).

The Revenue Procedure’s definitions § 6.02 states: “The term ‘Multiple Employer Retirement Plan’ means a defined contribution plan (including a plan that includes a cash or deferred arrangement described in § 401(k)) intended to satisfy the requirements of § 401(a) or § 403(a), and § 413(c), under which each CO [client organization] is treated as an employer.

Rev. Proc. 2002–21, 2002-19 I.R.B. 911, (May 13, 2002) https://www.irs.gov/pub/irs-irbs/irb02-19.pdf

Ignoring the specifics mentioned above, is the multiple employer plan made up of unrelated employers while the single employer plan is made up of two or more entities that are considered a related service group (ASG, CG?) and can be treated as a single employer for IRS purposes?