I have a parent-sub controlled group. There are no employees at the parent level. The parent owns four companies (3 of which they own more than 80%); therefore a parent-sub cg exists with the parent and 3 companies. Two of the three subs sponsor their own 401(k) plans, the third does not. Do the employees of all three subsidiaries have to be tested together even though the parent doesn't have a 401(k)?

Yes. It makes no difference which members of a controleld group are covered under a plan or plans, all employees of the group are treated as if employed by one employer for purposes of 410(b) testing. If each plan passes 410(b) on its own, then ADP/ACP testing can be completed on a plan-by-plan basis.

If you have to pass one ADP/ACP test because the plans do not pass 410(b) without aggregating, then I don't believe you can combine into one ADP/ACP test unless the plan year and testing method (current/prior year) are identical for each plan--or maybe you can't even perform 410(b) aggregation on plans with different plan years, I'm not sure.

ok...a little more info I rec'd...would I still have a controlled group if the "parent" company was an LLC owned by two other companies 50/50?

Yes, between the parent and subsidiary.

The question the new information raises is whether you need to add the two companies that own the parent into the control group chain. Are the two companies that each own 50% of the parent a control group themselves, giving each a 100% ownership of the parent?