Frequently Asked Questions > Employers Subject to COBRA > Are separate companies with separate Tax ID's subject to COBRA if combined, they are over 20 employees?
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Maybe. For COBRA puruposes, the term employer is defined using the IRS's Controlled Group Rules.; Separate employers that are considered a controlled group are likely to be treated as a single employer. Thus, a COBRA compliance failure by one employer might affect every employer in the commonly controlled group. When a "parent-subsidiary" or "brother-sister" relationship exists, the employer should consult with an attorney to determine if they are subject to COBRA.
For more information, see page 5174, Q-2 of the 1999 Final COBRA regulations.
Last updated on September 21, 2010 by Steve