Controlled group - not adopted timely

Hi

DC plan sponsored by ABC, Inc owned by Joe.

XYZ Inc is also owned by Joe but no employees.

Joe apparently took salary under XYZ Inc for 2023 and applied for pension purposes.

Joe now decided to let the TPA know this happened and wants TPA to have XYZ adopt the plan as well so that can continue having both firms within the plan.

Can the effective date of adoption be 1/1/2023 for XYZ Inc? Is this correctible under self-correction?

Thank you

any takers?

I vote for VCP.

3 minutes ago, Belgarath said:

I vote for VCP.

I do too, but I would not hold out hope that the IRS will rule favorably since the non-adopting employer has but one participant, an HCE by ownership.  

If a service credit or allocation regarding XYZ Inc for 2023 is mistaken:

Does anything restrict counting 2024 if XYZ Inc. and ABC Inc. this month make documents providing for XYZ Inc.’s participation in ABC Inc.’s plan beginning with January 1, 2024?

Check the plan document including the Adoption Agreement and Basic Plan Document.  There is at least one pre-approved plan where the AA includes an explicit exclusion of compensation received from non-signatory related employers, and the default definition of compensation in the BPD includes amounts earned from a related employer regardless of whether the related employer is or is not a signatory employer.

This may be helpful in this case if the plan has these provisions and if the contribution to the ABC plan was made by ABC based on compensation that included compensation earned at XYZ.

This could be a proverbial Hail Mary.