Ask the Experts!
Here’s the question of the day.
Question: I am working with an employer who leases 90% of his workforce from an employment leasing company. Do these contractors have to be included in the employer’s qualified plan?
Answer: Most likely yes. Leased staff members that are supervised and controlled by the employer are generally treated as employees for qualified plan purposes.
Here’s an excerpt from IRS Publication 560:
Leased employee. A leased employee … must generally be treated as your employee for retirement plan purposes if he or she does all the following.
- Provides services to you under an agreement between you and a leasing organization.
- Has performed services for you (or for you and related persons) substantially full time for at least 1 year.
- Performs services under your primary direction or control.
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