What Is a Controlled Group for 401(k) Plans?

Two companies can have different EINs, different payrolls and different 401(k) plans—and still be treated as one employer for major retirement-plan rules.

The controlled-group analysis starts with ownership.

Not:

• legal entity names
• payroll systems
• bank accounts
• state of formation
• whether each company files its own tax return
• whether each company signed a different retirement-plan document

Sections 414(b) and 414(c) can aggregate related corporations, partnerships, sole proprietorships, trusts and estates for specified retirement-plan purposes.^[1][2][3][4]

That can pull employees from a business with no 401(k) into the coverage analysis for a related company that has one.

It can force separate plans to coordinate contribution limits.

It can change HCE classification, top-heavy testing and vesting.

The controlled-group answer therefore belongs before annual testing, not after a TPA produces a failed report.

Key Takeaways

- Separate EINs do not prevent controlled-group treatment. - Section 414(b) covers controlled groups of corporations; Section 414(c) covers trades or businesses under common control, including noncorporate entities.^[2][3][4] - The three basic structures are: - parent-subsidiary - brother-sister - combined group.^[1][4] - A parent-subsidiary group generally uses an 80% controlling-interest threshold under the ordinary Section 414 rules.^[1][4] - A brother-sister group generally requires the same five or fewer individuals, estates or trusts to satisfy two tests: 1. at least 80% controlling interest in each organization 2. more than 50% effective control measured by identical ownership.^[1][4] - Common ownership of 80% or even 100% in the aggregate does not automatically satisfy the identical-ownership test. - Constructive ownership can change the direct cap-table percentages.^[4][5] - SECURE 2.0 changed family attribution for plan years beginning after 2023, including eliminating automatic attribution based solely on community-property law.^[2][6] - Final regulations effective for plan years beginning in 2025 extended partnership and trust attribution rules to specified parent-subsidiary Section 414(c) determinations.^[4][6] - Controlled-group members are treated as one employer for major rules including Sections 401, 410, 411, 415 and 416.^[2][3] - Controlled-group status does not automatically merge separate plans into one plan. - Section 415 has a special broader aggregation rule for certain parent-subsidiary relationships, substituting more than 50% for the ordinary 80% threshold.^[10] - An affiliated service group is a different test. Businesses can be aggregated under Section 414(m) even when ordinary controlled-group ownership thresholds are not met.^[1]

Different EINs Do Not Answer the Question

Assume one person owns:

• 100% of Company A
• 100% of Company B

Company A:

• operates in California
• has 15 employees
• sponsors a 401(k)

Company B:

• operates in Nevada
• has 40 employees
• sponsors no retirement plan
• uses a separate payroll company
• has a separate EIN

None of those separations prevents retirement-plan aggregation.

If the entities are under common control, the employees can be treated as employed by one employer for the applicable qualification rules.^[2][3]

Company A cannot test its 15 employees in isolation merely because Company B never signed Company A's plan document.

Controlled Group Does Not Mean One Legal Company

Controlled-group rules do not erase corporate law.

Company A remains Company A.

Company B remains Company B.

They can keep:

• separate contracts
• separate payroll
• separate bank accounts
• separate tax filings where applicable
• separate retirement plans

The retirement-plan rules can still treat the employees as working for a single employer for specified Code provisions.^[2][3]

That distinction matters.

A controlled group is an aggregation rule, not a merger.

The Three Controlled-Group Structures

Treasury regulations identify three basic forms:^[4]

1. parent-subsidiary
2. brother-sister
3. combined

The ownership mathematics differ.

Using the wrong test can turn a correct ownership chart into a wrong retirement-plan conclusion.

Parent-Subsidiary Controlled Group

A parent-subsidiary group exists when organizations are connected through a chain of controlling ownership and a common parent owns the required controlling interest in at least one other organization.^[4]

For the ordinary Section 414(c) rule, controlling interest generally means:

Corporation

At least:

80% of voting power or value

Partnership

At least:

80% of profits interest or capital interest

Trust or estate

At least:

80% actuarial interest

Sole proprietorship

Ownership of the proprietorship.^[4]

The rule is not limited to corporations.

Example: Parent Owns 80%

Holding Company owns:

80%

of Operating Company.

Assuming the other regulatory conditions are satisfied:

parent-subsidiary controlled group

The remaining 20% can be owned by unrelated investors.

The parent does not need 100%.

Example: Parent Owns 79%

Holding Company owns:

79%

of Operating Company.

Under the ordinary 80% parent-subsidiary controlling-interest test:

79% is not 80%.

That fact can prevent ordinary parent-subsidiary controlled-group treatment under Section 414(c).

Do not stop the analysis there.

Section 415 uses a broader special rule discussed later.

An ownership percentage can be below 80% and still matter for retirement-plan contribution limits.

Chains Count

Assume:

• Parent owns 80% of Subsidiary A
• Subsidiary A owns 80% of Subsidiary B

The regulations can treat the chain as a parent-subsidiary group when the ownership requirements are met.^[4]

The group analysis does not stop at the first tier.

This matters in structures using:

• holding companies
• operating subsidiaries
• real estate entities
• management companies

A TPA needs the whole chart.

Brother-Sister Controlled Group

Brother-sister analysis is where most ownership shortcuts fail.

The same five or fewer persons who are:

• individuals
• estates
• trusts

generally must satisfy both:^[4]

Gate 1: Controlling interest

The same five or fewer common owners must own at least:

80%

of each organization.

Gate 2: Effective control

Taking each person's ownership only to the extent it is identical across the organizations, those same persons must own:

more than 50%

of each organization.^[4]

Passing only the first gate is not enough.

Identical Ownership Is the Trap

Assume two unrelated owners:

Company A

Owner 1: 80% Owner 2: 20%

Company B

Owner 1: 20% Owner 2: 80%

Together, the same two people own:

100% of each company

So the 80% controlling-interest test is easily satisfied.

Now calculate identical ownership.

Owner 1 owns:

• 80% of A
• 20% of B

Identical ownership:

20%

Owner 2 owns:

• 20% of A
• 80% of B

Identical ownership:

20%

Combined identical ownership:

40%

The effective-control test requires:

more than 50%.^[4]

Result:

No brother-sister controlled group under this test.

The same owners hold every share of both companies and still fail.

That is why "same owners" is not enough.

Example: 60/40 in Both Companies

Company A

Owner 1: 60% Owner 2: 40%

Company B

Owner 1: 60% Owner 2: 40%

Common ownership:

100% in each

Identical ownership:

• Owner 1: 60%
• Owner 2: 40%

Total identical ownership:

100%

Both gates are satisfied.

Result:

Brother-sister controlled group

Example: 70/30 and 60/40

Company A

Owner 1: 70% Owner 2: 30%

Company B

Owner 1: 60% Owner 2: 40%

The same two owners hold 100% of both companies.

Identical ownership:

Owner 1:

60%

Owner 2:

30%

Total:

90%

That exceeds 50%.

The 80% controlling-interest test is also satisfied.

Result:

Brother-sister controlled group

The identical amount uses the lower ownership percentage for each common owner across the organizations.

Five or Fewer Common Owners

The brother-sister rule does not simply add every shareholder.

The same:

five or fewer

individuals, estates or trusts must satisfy the ownership conditions.^[4]

That produces another counterintuitive case.

IRS regulations include an example in which eight shareholders own two corporations in identical percentages. Any five shareholders collectively own more than 50%, but no same five own 80% of both entities.

Result:

No brother-sister group under that example.^[4]

A widely dispersed cap table can defeat the five-or-fewer requirement even when the two corporations have identical overall shareholder populations.

Combined Group

A combined group exists when:

• three or more organizations are involved
• each belongs to either a parent-subsidiary or brother-sister group
• at least one organization is both:
• the common parent of a parent-subsidiary group
• a member of a brother-sister group.^[4]

This rule connects ownership structures that would otherwise be tested in separate boxes.

Example: Combined Structure

Owner controls:

• Partnership A
• Partnership B

Partnership A owns 80% of Corporation C.

Assume A and B form a brother-sister group.

A and C form a parent-subsidiary group.

A sits in both relationships.

The regulations can treat:

• A
• B
• C

as one combined group.^[4]

The business chart can look fragmented.

The retirement-plan employer can still be one group.

Direct Ownership Is Only the First Pass

A controlled-group calculation based only on:

shares shown on the cap table

can be wrong.

Treasury regulations contain constructive-ownership rules that can attribute ownership through:^[5]

• options
• partnerships
• estates or trusts
• corporations
• spouses
• specified family relationships

The exact attribution rule depends on:

• entity type
• relationship
• ownership percentage
• whether the test is parent-subsidiary or brother-sister
• statutory exceptions

Do not apply one family-attribution shortcut to every structure.

Spouse Attribution Has Exceptions

The general constructive-ownership regulations can attribute one spouse's interest to the other, subject to an exception with multiple conditions.^[5][8]

IRS gives an example involving a spouse-owned business and emphasizes that attribution depends on facts such as whether the other spouse:

• owns a direct interest
• participates as an officer, employee, fiduciary or manager
• has specified economic relationships with the business
• satisfies the remaining regulatory conditions.^[8]

So this statement is wrong:

"My spouse owns it, therefore I automatically own it for controlled-group purposes."

This statement is also wrong:

"My spouse owns it, therefore it can never be part of my controlled group."

Run the attribution rules.

SECURE 2.0 Changed Family Attribution

Older explanations can be stale here.

SECURE 2.0 amended Section 414's family-attribution rules for plan years beginning after December 31, 2023.^[2][6]

The changes include:

• disregarding community-property laws for controlled-group ownership analysis under Section 414(b)
• limiting specified spouse attribution that would otherwise occur indirectly through a minor child
• limiting situations where stock in different corporations attributed to a child from each parent creates a controlled group by itself.^[2][6]

The purpose was to stop certain spouses with separate businesses from being aggregated solely because state community-property law or child-attribution mechanics produced artificial common ownership.

Community Property No Longer Settles It

Assume spouses in a community-property state each operate genuinely separate businesses.

Old analyses sometimes treated community-property ownership as enough to create common ownership.

Section 414 now directs that community-property laws be disregarded for the specified controlled-group attribution analysis.^[2][6]

That does not mean spouses are never aggregated.

Other direct or constructive-ownership rules can still produce a group.

The change removes one automatic path.

A 2025 Attribution Change Matters Too

Final regulations published December 30, 2024 changed Section 414(c) parent-subsidiary analysis.

IRS's 2026 qualification list states that the regulations extend:

• partnership attribution
• trust attribution

to determining whether a parent-subsidiary controlled group exists under Section 414(c).^[6]

The change applies to plan years beginning on or after:

January 1, 2025.^[6]

A pre-2025 ownership memo can therefore be wrong even when no direct ownership changed.

Partnerships Do Not Escape the Rule

Assume:

• Corporation A owns a large partnership interest in Partnership B
• Partnership B owns interests in another operating entity

Section 414(c) explicitly covers trades or businesses whether or not incorporated.^[2][3][4]

The analysis can move through:

• corporate stock
• partnership profits interests
• partnership capital interests
• constructive ownership

A structure built with LLCs and partnerships is not outside the retirement-plan aggregation regime merely because it avoids a parent/subsidiary corporate chart.

LLC Is Not a Controlled-Group Category

"LLC" is a state-law entity label.

For federal tax purposes an LLC can be treated as:

• corporation
• partnership
• disregarded entity

depending on its ownership and elections.

Controlled-group analysis follows the applicable federal ownership rules for the underlying trade or business structure.

The phrase:

"They are separate LLCs"

does not answer the retirement-plan question.

What Happens When Businesses Are a Controlled Group?

Section 414 treats employees of controlled-group members as employed by a single employer for specified retirement-plan provisions.^[2][3]

That can affect:

• qualification under Section 401
• coverage under Section 410
• vesting under Section 411
• contribution and benefit limits under Section 415
• top-heavy rules under Section 416.^[2][3]

The exact effect depends on the rule being applied.

Controlled-group status is not one universal command that every plan must operate identically.

Coverage Is Usually the First Visible Problem

INV-089 explains Section 410(b).

Assume:

Company A

10 employees 401(k) covers all 10

Company B

40 employees no plan

If A and B are a controlled group, Company A cannot necessarily claim:

100% employee coverage

by looking only at its own payroll.

Employees of B can enter the statutory employer population.

The plan can fail coverage even though every employee named in Company A's document was treated correctly.

Separate Plans Do Not Solve the Group Problem

Assume:

• Company A has Plan A
• Company B has Plan B
• both companies are in one controlled group

The employers can maintain separate plans.

That does not mean each plan can be tested as if the other company did not exist.

Depending on the provision, plans and employee populations can need:

• aggregation
• disaggregation
• coordinated coverage testing
• coordinated nondiscrimination testing
• coordinated contribution-limit analysis

"Separate plan document" is not a controlled-group exemption.

ADP and ACP Can Be Affected

INV-087 covers ADP.

INV-088 covers ACP.

Controlled-group status can alter:

• which employees belong in the testing employer population
• HCE classification
• related-plan aggregation
• coverage architecture feeding the tests

A TPA testing only the entity that signed the adoption agreement can produce a mathematically correct result for the wrong employer.

HCE Status Can Change

Section 414's single-employer rules interact with HCE determination.

An employee's:

• ownership
• compensation
• relationship to other group members

can therefore need to be analyzed across the relevant related-employer structure rather than one payroll entity.

INV-084 explains HCE classification.

This matters when an owner receives compensation from one entity but owns another entity in the group.

Service and Vesting Can Cross Entity Lines

Because Section 411 is among the provisions to which Sections 414(b) and (c) apply, service with another controlled-group employer can matter to vesting.^[2][3]

Example:

Employee works:

• three years for Company A
• transfers to controlled-group Company B

A plan should not automatically treat the move as if the person left the statutory employer entirely.

The exact service-credit result depends on:

• plan terms
• controlled-group timing
• applicable service rules

But separate payroll does not justify resetting service to zero.

Top-Heavy Testing Can Change

INV-085 defines key employees.

INV-086 explains top-heavy testing.

Controlled-group structure can affect:

• key-employee analysis
• required plan aggregation
• which employer plans belong in the Section 416 test

A plan that looks 55% top-heavy alone can be part of a required group whose combined ratio exceeds 60%.

The controlled-group map belongs upstream of the ratio.

Section 415 Has a Broader Control Rule

This is one of the most important advanced exceptions.

For ordinary parent-subsidiary controlled-group analysis under Section 414(c), the controlling-interest threshold is generally:

80%.^[4]

For Section 415 contribution and benefit limits, the regulations apply a special modification: more than 50% replaces the ordinary 80% threshold in specified parent-subsidiary controlled-group rules.^[10]

That means:

79% ownership can fail the ordinary 80% controlled-group test and still require Section 415 aggregation.

Do not use one ownership answer for every retirement-plan provision.

Example: 60% Parent Ownership

Company A owns:

60%

of Company B.

Ordinary parent-subsidiary Section 414(c) threshold:

not met

because 60% is below 80%.

For Section 415, however, the special rule can treat the businesses as affiliated employers because the applicable parent-subsidiary threshold is broadened to more than 50%.^[10]

If the same participant receives annual additions under defined contribution plans maintained by the related employers, Section 415 aggregation can matter.

This is a specialist point worth flagging whenever ownership is between:

50% and 80%.

Why Section 415 Aggregation Matters

Suppose an owner participates in:

• Company A 401(k)
• Company B profit-sharing plan

If the companies are treated as a single employer for Section 415, the participant cannot assume each plan supplies a separate full Section 415 annual-additions limit.

The contributions can have to be aggregated under the applicable rules.^[10]

A second plan does not automatically create a second federal ceiling.

Controlled Group Does Not Automatically Require One Plan

This misconception causes unnecessary redesign.

A controlled group can maintain:

• one plan covering all members
• separate plans for different members
• different contribution formulas
• different eligibility structures

subject to the qualification, coverage, nondiscrimination and aggregation rules.

The issue is not:

"Must every company have the identical plan?"

The issue is:

"Does the total arrangement satisfy the Code after the employers are treated as related?"

Controlled Group vs Affiliated Service Group

These are different routes to single-employer treatment.

Controlled group

Driven primarily by ownership and common-control rules under Sections 414(b) and 414(c).

Affiliated service group

Driven by Section 414(m), which can combine organizations based on specified ownership and service relationships.^[1][2]

A professional-services structure can fail the ordinary controlled-group ownership tests and still be an affiliated service group.

That is why a controlled-group analysis should not end with:

"The ownership percentages do not reach 80%."

A separate Section 414(m) review can still be required.

Example: Medical Practice Structure

Physicians own separate professional entities.

A central management company provides services.

Ownership may be divided so that no straightforward brother-sister controlled group exists.

The organizations can still require affiliated-service-group analysis if the statutory service and ownership relationships are present.

Controlled group asks one question.

Affiliated service group asks another.

Do not use one as a substitute for the other.

The Ownership Matrix

Before annual testing, build one table.

Then run the analysis in this order.

Step 1: List Every Trade or Business

Include:

• corporations
• S corporations
• C corporations
• partnerships
• sole proprietorships
• operating LLCs
• management entities
• real estate businesses where they constitute trades or businesses
• trusts or estates with relevant ownership interests

Do not start with:

"Which companies have a 401(k)?"

Start with the business structure.

Step 2: Record Direct Ownership

Capture:

• voting ownership
• value ownership
• partnership profits interest
• partnership capital interest
• options
• trust or estate interests

For brother-sister analysis, owner identity across entities matters.

Step 3: Apply Constructive Ownership

Review:^[5]

• options
• partnership attribution
• corporate attribution
• trust/estate attribution
• spouse attribution
• family attribution

Use the current rules, including SECURE 2.0 changes.

Do not copy an ownership analysis prepared before 2024 without checking whether family attribution changed.

Step 4: Test Parent-Subsidiary Control

Look for:

80% controlling interest

through chains of ownership under the ordinary Section 414(c) rule.^[4]

Then separately flag any:

more-than-50%-but-less-than-80%

relationship for Section 415 review.^[10]

Step 5: Test Brother-Sister Control

Identify the same five or fewer:

• individuals
• estates
• trusts

Then run both:

1. 80% controlling-interest test
2. more-than-50% identical-ownership test.^[4]

Do not stop after the first.

Step 6: Test Combined Groups

Ask whether one organization bridges:

• a parent-subsidiary group
• a brother-sister group.^[4]

If yes, the combined-group rules can connect the structures.

Step 7: Run the Affiliated Service Group Check

Even if ordinary controlled-group tests fail, ask whether Section 414(m) can aggregate service organizations.

This deserves a separate analysis.

Step 8: Map Every Retirement Plan

For each entity, list:

• 401(k)
• profit-sharing plan
• defined benefit or cash balance plan
• SEP
• SIMPLE IRA
• other employer retirement arrangement

Then identify which qualification rules require group-wide treatment.

The ownership analysis is useless if it never reaches the plan inventory.

Annual Testing Should Ask the Ownership Question Every Year

Controlled-group status can change because of:

• stock sale
• new partner
• redemption
• divorce
• marriage
• trust transfer
• option grant
• acquisition
• disposition
• creation of a new entity

The payroll file can remain unchanged while the retirement-plan employer changes legally.

IRS internal-control guidance tells sponsors to determine who is responsible for identifying controlled groups and affiliated service groups.^[7]

That responsibility should have a name attached to it.

The TPA Cannot Infer a New Entity

A business owner forms:

Company C

in April.

Company C hires 25 employees.

The 401(k) TPA receives the same year-end census from Company A it received last year.

Nobody mentions C.

The TPA tests A.

The report passes.

That report proves only that A passed under the data supplied.

It does not establish that the statutory employer group was identified correctly.

INV-083 covers this data-responsibility problem.

Acquisitions Need Controlled-Group Review Before Closing

An acquisition can change:

• employer population
• plan coverage
• HCE status
• top-heavy aggregation
• Section 415 aggregation
• plan eligibility
• transition relief

The purchase agreement does not need to close before the retirement-plan issue exists conceptually.

Benefits diligence should ask:

• what entities enter the group?
• what plans do they maintain?
• who participates?
• what testing methods are used?
• what contributions have already been made?
• does Section 410(b)(6)(C) transition relief apply?

INV-089 explains the coverage transition rule.

Dispositions Can Break the Group

Selling a subsidiary can remove it from the controlled group.

That can affect:

• future testing population
• service credit
• plan sponsorship
• participant status
• plan aggregation

Do not assume the retirement-plan consequences occur automatically on the same operational timeline as payroll separation.

The plan documents and transaction structure need to be reviewed.

A Control Analysis Is Not Permanent

A memorandum saying:

"No controlled group — 2022"

is not a lifetime conclusion.

It reflects:

• ownership on that date
• attribution law on that date
• entity structure on that date

SECURE 2.0 changed family attribution.

Final regulations changed specified partnership/trust attribution beginning in 2025.^[6]

Ownership can change next week.

Review the analysis when the facts or law change.

Common High-Risk Fact Patterns

Owner starts a second business

Especially when employees are hired outside the original plan sponsor.

Spouses own separate businesses

Attribution must be tested under current rules, not assumed.

Parent owns 51% to 79% of subsidiary

Ordinary control may fail while Section 415 still matters.

Same owners use different percentages across businesses

Run the identical-ownership calculation.

Management company plus professional practices

Check affiliated service group rules even if controlled-group ownership fails.

Partnership inserted into ownership chain

Apply the post-2024/2025 attribution rules.

Acquisition or recapitalization

Retest immediately.

Frequently Asked Questions

What is a controlled group for 401(k) purposes?

A controlled group is a group of corporations or trades or businesses under common control that federal tax law treats as a single employer for specified retirement-plan provisions.^[2][3]

Do companies need the same EIN to be a controlled group?

No. EINs do not determine controlled-group status.

What is the parent-subsidiary threshold?

Under the ordinary Section 414(c) rule, controlling interest is generally at least 80% for corporations, partnerships and specified other organizations, measured under the applicable ownership rules.^[4]

What is a brother-sister controlled group?

It generally involves two or more organizations where the same five or fewer individuals, estates or trusts satisfy both an 80% controlling-interest test and a more-than-50% identical-ownership test.^[4]

What does identical ownership mean?

For each common owner, use the lowest ownership percentage the person holds across the entities being tested. Add those identical percentages. The total generally must exceed 50% for effective control.^[4]

Can the same people own 100% of two companies without creating a brother-sister group?

Yes. If ownership percentages differ enough, identical ownership can be 50% or less even though the same people collectively own 100% of both companies.

Does spouse ownership count?

It can, but spouse attribution has exceptions and SECURE 2.0 changed specified family-attribution rules. The answer depends on the facts and current regulations.^[2][5][6][8]

Does community-property law automatically combine spouses' businesses?

Not for the specified Section 414(b) attribution analysis after the SECURE 2.0 reform. Section 414 directs that community-property laws be disregarded for that purpose.^[2][6]

Can partnerships be part of a controlled group?

Yes. Section 414(c) covers trades or businesses whether or not incorporated, and the regulations contain specific partnership ownership rules.^[3][4][5]

Did the partnership attribution rules change recently?

Yes. Final regulations effective for plan years beginning on or after January 1, 2025 extended partnership and trust attribution rules to specified parent-subsidiary Section 414(c) determinations.^[6]

Does controlled-group status mean all companies must use one 401(k)?

No. Separate plans can remain separate. The employers still have to apply the qualification and aggregation rules required by the Code.

Do employees of every controlled-group member automatically enter one company's plan?

Not automatically. Plan eligibility remains governed by plan terms and applicable law, but employees across the group can have to be considered in coverage, nondiscrimination and other qualification tests.

Can controlled-group status affect vesting?

Yes. Sections 414(b) and (c) apply single-employer treatment for Section 411, so service across controlled-group members can matter to vesting.^[2][3]

Can controlled-group status affect top-heavy testing?

Yes. Section 416 is one of the provisions expressly subject to the controlled-group single-employer rules.^[2][3]

What happens at 79% parent ownership?

The ordinary 80% parent-subsidiary threshold may not be met. Section 415 uses a special broader rule for certain parent-subsidiary relationships, substituting more than 50% for the ordinary 80% threshold.^[10]

Is an affiliated service group the same as a controlled group?

No. Section 414(m) uses separate service-relationship rules and can aggregate businesses that do not satisfy ordinary controlled-group ownership thresholds.^[1][2]

The Ownership Test to Run Before the 401(k) Test

Before accepting any annual compliance report, answer:

1. What trades or businesses does each owner control?
2. What are the direct ownership percentages?
3. What ownership is constructively attributed?
4. Does an 80% parent-subsidiary chain exist?
5. Do the same five or fewer owners satisfy both brother-sister tests?
6. Is there a combined group?
7. Is any 51%-to-79% parent ownership relevant under Section 415?
8. Does an affiliated service group exist even if controlled-group testing fails?
9. Which retirement plans does every related entity maintain?

Only then decide which employee population belongs in the plan tests.

The controlled-group calculation is upstream of the 401(k) calculation.

Sources & References

1. IRS: Chapter 7 — Controlled and Affiliated Service Groups
2. 26 U.S.C. §414 — Definitions and Special Rules
3. 26 CFR §1.414(c)-1 — Commonly Controlled Trades or Businesses
4. 26 CFR §1.414(c)-2 — Two or More Trades or Businesses Under Common Control
5. 26 CFR §1.414(c)-4 — Rules for Determining Ownership
6. IRS: 2026 Cumulative List of Changes in Plan Qualification Requirements
7. IRS: Policies, Procedures and Internal Controls Self-Audit
8. IRS: Fixing Common Plan Mistakes — SIMPLE IRA Sponsor With a Related Business
9. IRS: A Guide to Common Qualified Plan Requirements
10. IRS: Section 415 Employee Plans Technical Guidelines

Educational Disclaimer

ROIStreet publishes educational content about retirement-plan employer aggregation and compliance. This article is not legal, tax, fiduciary or plan-administration advice. Controlled-group status depends on entity type, direct and constructive ownership, family relationships, business activity, plan year, transaction timing and current law.

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