When do you determine a CG or ASG?

An attorney has a P.C. (100% owed). he also owns 50% of a CPA firm with which he is associated. No doubt, this is an A-Org/FSO ASG. Sometime in 2020 he sells his interest in the CPA firm. He still works there, but is no longer an owner.

Does this break the ASG in 2020? When do we make that determination? First day of the year? Last day of the year? Any day of the year? I don't see any guidance on this. If this were a controlled group issue, does the determination date differ? 

A CG or ASG exists (or doesn't) on every day of the year. Its existence (or non-existence) mostly affects coverage testing, so it matters which method you're using to satisfy coverage. Assuming you're using the annual method of 1.410(b)-8(a)(4) , you need to satisfy coverage on the last day of the year taking into account all employees who were eligible at any point during the year. If an employee was eligible for the portion of 2020 while the ASG existed, but ceased to be eligible once the ASG ceased to exist, they would still need to be included in coverage testing for 2020.

So, if we used the daily method under 1.410(b)-8(a)(2), we could bifurcate any benefits between those while a CG/.ASG and those after via restructuring. Admittedly, this may be difficult, but theoretically it could be worth a look.

I think I would rather have Covid than do daily testing on any regular basis.

5 minutes ago, Purplemandinga said:

I think I would rather have Covid than do daily testing on any regular basis.

But could we not, in this instance, do it for the period while an ASG, and then for the period when it wasn't? That would solve any "shortness of breadth".?

I would not suggest using daily testing chronically.

Ha!

But to answer your question, yes, I think you could use daily testing, but I would read the examples in the regs closely to see if it provides the relief you are looking for.