Form 5300

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Form 5300 (Application for Determination Letter)

Form 5300 allows benefit plans to obtain a determination letter from the IRS regarding the qualification of the plan and the tax exempt status of any related trust.


Forms and Instructions

2012 Changes

Beginning February 1, 2012, for individually designed plans, and May 1, 2012, for pre-approved plans, the IRS will no longer permit Schedule Q to be filed to make elective nondiscrimination determination requests.

Guidance

  • Rev. Proc. 2007-44 provides updated guidance on the five-year remedial amendment cycle for individually designed plans. Generally, such plans may rely on a determination letter for five years.

Typically, a plan's five year remedial amendment cycle is determined by the last digit of the plan sponsor's EIN: 1 or 6 -- Cycle A 2 or 7 -- Cycle B 3 or 8 -- Cycle C 4 or 9 -- Cycle D 5 or 0 -- Cycle E

Cycle A ended January 31, 2007. However, certain plans that determined they were not Cycle A plans based on a reasonable and good faith interpretation of Rev. Proc. 2005-66, but are Cycle A plans under Rev. Proc. 2007-44 have six months from July 9, 2007 to submit the plan to the IRS.

  • Rev. Proc. 2005-66 (PDF) was the initial guidance on the cyclical remedial amendment periods.
  • Rev Proc 2008-6 provides IRS revised procedures for issuing determination letters.
  • Rev Proc 2008-8 sets forth the procedure for determination letter applications and other letter rulings.

How to File

  1. Review the Form 5300 Instructions and the current revenue procedure on determination letter requests. (Currently, this is Rev Proc 2010-6.)
  2. Gather the plan document, any amendments to it, and the trust document.
  3. If you are filing on your remedial amendment cycle or have more than 3 amendments, restate the plan.
  4. Create a list of amendments to the plan with a brief description of each amendment.
  5. Create a list of all other plans in the controlled group.
  6. Gather any prior determination letter, and prepare a redlined or highlighted document showing the changes between the current plan terms and the plan when it was given a favorable determination letter.
  7. Fill out Form 5300 and any schedules for optional determinations.
  8. Fill out Form 8717 and get an appropriate check.
  9. Pick a date to file the determination letter package.
  10. Send out the Notice to Interested Parties at least 10 but not more than 24 days before the filing date.
  11. Send out the determination letter package on the filing date. (See the Form 5300 instructions for the correct address.)

Tips on Specific Form 5300 Questions and Items

Line 4(e)

A participant means:

1. The total number of employees participating in the plan including employes under a section 401(k) qualified cash or deferred arrangement who are eligible but do not make elective deferrals.

2. Retirees and other former employees who have a nonforfeitable right to benefits under the plan, and

3. The beneficiary of a deceased employee who is receiving or will in the future receive benefits under the plan. Include one beneficiary for each deceased employee regardless of the number of individuals receiving benefits.

Q 7(d):

Answer no unless the plan is fully funded by qualified insurance contracts. See Code Section 412.

Amendment List

Include a list of all plan amendments (including restatements) and a brief description of each amendment with your Form 5300 filing.

Example: Amendment 1 -- required for prior determination letter Amendment 2 -- EGTRRA amendment Amendment 3 -- revise definition of compensation and vesting

Controlled Group List

Create a list that shows in detail:

  • All members of the sponsor's controlled group;
  • The relationship of each member to the sponsor;
  • The type of ERISA retirement plans each member has (e.g., 401(k) plan, defined benefit plan, money purchase plan, etc.); and
  • The name, plan sponsor EIN, and plan number of any plans common to all members.