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Coverage Testing When Spouses Each Own a Business
Retirement Management Services Link to more items from this source
July 18, 2014
"Suppose a husband and wife each own separate, unrelated businesses. If [certain exceptions] are met, each individual will be considered to have sole ownership over their respective companies, without any attribution of ownership to the spouse.... However, when the spouses in question have a child under age 21, the exceptions ... won't matter because a controlled group will be deemed to exist due to the fact that the minor child is attributed stock in each company ... If both companies are considered part of a controlled group because of the child's ownership, it may be difficult to demonstrate compliance with the 70% coverage testing if only one company is providing retirement benefits to its employees."

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