The 1970s introduced the controlled group and common control rules to the qualified plan arena. The 1980s added a new aggregation system, affiliated service groups (ASGs).
In a marked contrast to the controlled group rules, the ASG rules rely heavily on facts and circumstances. However, their end result is the same: to join two or more entities as a single employer for qualified plan purposes. In fact, almost all of Chapter 10, dealing with the consequences of controlled group status, and Chapter 11, dealing with changes in group status, apply with equal for to ASGs.
This chapter will explore both traditional affiliated service groups and management function groups. It will describe their composition and their consequences. The attribution rules for traditional affiliated service groups are detailed in Chapter 14.
 | Q 13:1 Why did Congress adopt the affiliated service group rules? |
| Q 13:2 What types of affiliated service groups are there? |
| Q 13:3 Where do we find the rules for ASGs? |
| Q 13:4 What is a traditional ASG? |
| Q 13:5 What is a service organization? |
| Q 13:6 What is an A-Org? |
| Q 13:7 What is an FSO for purposes of the A-Org rules? |
| Q 13:8 What is a B-Org? |
| Q 13:9 What is an FSO for purposes of the B-Org rules? |
| Q 13:10 How can I tell if performance of employee services for an FSO or its A-Orgs is a “significant portion” of a B-Org’s business? |
| Q 13:11 How can I tell if services are of a type historically performed by employees of the FSO and/or its A-Orgs? |
| Q 13:12 Would an expense sharing arrangement with shared employees be an ASG? |
| Q 13:13 What is a management function group? |
| Q 13:14 What is a related business for purposes of a management function group? |
| Q 13:15 What is a management function? |
| Q 13:16 Do corporate directors provide management functions? |
| Q 13:17 How do we know if the performance of management functions for a client is the “principal business” of a management firm? |
| Q 13:18 Are related entities considered together in determining the principal business of the management organization? |
| Q 13:19 If a management function group exists, are organizations related to the management firm included in the group? |
| Q 13:20 If a management function group exists, are organizations related to the client included in the group, even if the management firm does not mange them? |
| Q 13:21 What are the consequences of being in an affiliated service group? |
| Q 13:22 Can a plan adopted by an ASG member cover the employee of another member of the ASG if that other member has not spon-sored the plan? |
| Q 13:23 Can an ASG be part of a qualified Separate Line of Business (SLOB) under IRC §414(r)? |
| Q 13:24 How are the IRC §404 deduction limits applied to ASG mem-bers that jointly sponsor plans with other ASG members or cover their employees? |
| Q 13:25 Are the funding requirements of IRC §412 and the related penalties under IRC §4971 computed separately for each ASG em-ployer, or on an aggregate basis? |
| Q 13:26 What are the nonpension employee benefit consequences of being in an ASG? |
| Q 13:27 How are changes in affiliated service group members han-dled? |
| Q 13:28 Can you have overlapping ASGs? What happens if you do? |
| Q 13:29 Can an employer obtain a determination letter regarding ASG status? |
| Q 13:30 Is there a methodology to follow in resolving ASG questions? |