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Posted

In the situation where you have a control group that use one plan.... It seams to reason that each company pays the contribution required for it's own employees... right?  I'm talking a straight forward 3% SHNEC.

Can Company-A pay Company-B's 3% SHNEC?  (curious with this question)

Just need confirmation, thanks

Posted

I would defer to the company's accountant, but if the consolidated company files a consolidated tax return, then any or all companies within the control group can contribute whatever amounts. However, if A & B file separate tax returns I believe each must contribute and deduct their respective amounts. At least that is my recollection, but again, a qualified tax accountant for the company(ies) should be able to answer definitively.

Kenneth M. Prell, CEBS, ERPA

Vice President, BPAS Actuarial & Pension Services

kprell@bpas.com

Posted

I think the underlying thought there to Cuse's point is that why would/should a company get a deduction for some OTHER company's ordinary business expense.  One tax return blurs it all together, separate ones would not.

  • 4 weeks later...
Posted

Thank you.  Ya, doesn't make sense for one company to pay another company's contributions.  And they are not filing a joint return.   Looking at your responses I should have thought of that.

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