Do the participation requirements of IRC 408(k)(2) apply on a controlled group basis? In other words, if an employer that is a member of a contolled group sponsors a SEP, must the SEP cover all of its employees AND all of the employees of its affiliates? Is there transition relief in the event of acquisition of a subsidiary?

Any replies would be appreciated...

Code Section 414(B) says yes. Contolled group rules apply to 408(k) and (p) Thus, all the transition rules apply

[This message has been edited by Bill Berke (edited 04-20-2000).]