An individual 401(k) plan, also known as a solo 401(k), allows a business owner to contribute almost three times as much as a regular plan. Instead of setting up a 401(k) plan for Business X, he creates Business Y just for himself and sets up a solo 401(k) plan for Business Y (without including employees from Business X). The Controlled Group RulesThe Internal Revenue Code established the controlled group rules as part of the Revenue Act of 1964. In other words, the family attribution rules are there to prevent the use of families circumventing the controlled group rules. Affiliated ServicesThe affiliated services rules are effectively catch-all rules the IRS developed to backstop the parent-subsidiary and brother-sister controlled group rules.

Source: Forbes July 27, 2020 12:45 UTC