An individual owns and is the only employee of 2 different unrealted companies. The financial adviser has informed the individual that he/she can have two plans and contribute $20,000 to each plan.(there is no salary deferral). I am having a brain cramp and don't believe this is possible. Could someone confirm one way or the other. Thanks

I'm not sure what you mean by unrelated. If he is sole owner of 2 companies, the 2 companies are a controlled goup.

Each company could sponsor a profit sharing plan. Depending on compensation the owner/employee could get a $20,000 allocation under each plan. If its a controlled group situation, it may be better to establish 1 SEP.

in my original post I was thinking incorrectly of the 40,000 annual addition dollar limit and dividing it, but what I really was thinking how about $40,000 in each plan

He can't get $40,000 in each plan. It is a controlled group, so it's just like it's one employer.

Isn't there a reg that says even if it is not a control group the 80% threshold is reduced to 50% for the application of the 415 limit?

I remember it and looked for 5 mins but can't find it...

§ 415 Limitations on benefits and contributions under qualified plans.
(h) 50 percent control.
For purposes of applying subsections (b) and © of section 414 to this section, the phrase "more than 50 percent" shall be substituted for the phrase "at least 80 percent" each place it appears in section 1563(a)(1).