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Form 5309: Application for Determination of Employee Stock Ownership Plan
IRS Form 5309 is the Application for Determination of Employee Stock Ownership Plan, used to apply under section 4975(e)(7) of the Internal Revenue Code. This form must be attached to Form 5300 and applies to plan years ending after March 14, 2001.
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IRS Form 5309 - Application for Determination of Employee Stock Ownership Plan
IRS Form 5309 is the Application for Determination of Employee Stock Ownership Plan, used to apply under section 4975(e)(7) of the Internal Revenue Code. This form must be attached to Form 5300 and applies to plan years ending after March 14, 2001.
Risk Radar
Scan points- 1Do not use a stamped signature; the principal officer must sign Form 5309 directly.
- 2Filing without attaching Form 5309 to Form 5300.
- 3Using a stamped signature instead of the principal officer's original signature.
- 4Entering data in font other than Courier 10 point.
- 5Failing to enter a number when one is requested (leaving it blank).
Plain English
This form allows an employer to ask the IRS if their Employee Stock Ownership Plan (ESOP) meets all the necessary rules for tax benefits. By filing this, the employer seeks a formal determination letter from the IRS regarding their plan's compliance. The plan must primarily invest in the company's own stock to qualify.
Submission Date
- Filing date: 2012-07-17 00:00:00
- Preparation window: collect IDs, supporting records, and signatures in advance.
- Final review: verify names, dates, and required fields before submission.
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What this form is for
- Use this form when applying for a determination letter that an employee stock ownership plan (ESOP) meets the requirements of section 4975(e)(7) of the Internal Revenue Code.
- Do not use this form when the plan is established and maintained by a bank legally prohibited from redeeming or purchasing its stock, unless answering specific questions on lines d through f to confirm other criteria are met.
- Check Form 5300 instead when submitting the application for determination of an employee benefit plan.
Form selector
Use this form or another form?
Plan is a single-employer ESOP
Used to apply under section 4975(e)(7) of the Internal Revenue Code.
✓ Check before you continue
Need to confirm plan meets specific loan requirements
Questions d, e, and f address limitations on assets related to exempt loans.
✓ Check before you continue
Plan is not an ESOP but needs determination
Used if the plan does not meet criteria in line 4a, but requires IRS review for qualification under section 4975(e)(7).
✓ Check before you continue
Deadline or filing window
The filing is required upon establishment or amendment of the ESOP, applicable to plan years ending after March 14, 2001. The source does not state a specific deadline date but requires submission for determination letter eligibility.
Checklist
What you need before filling it out
Plan Sponsor Name
Name of plan sponsor (employer if single-employer plan) · Line 1
EIN
Employer identification number (EIN) · Line 2
ESOP Designation
Does the plan qualify as an ESOP under section 4975(e)(7)? · Line 4a
Exempt Loan Asset Restriction
Does the plan restrict payments to only collateral, contributions, and earnings? · Line 4d
Bank Prohibition Check
Is the plan maintained by a bank legally prohibited from redeeming/purchasing stock? · Line 4e
Required Attachment
Form 5300, Application for Determination for Employee Benefit Plan · Attach to Form 5309
Before you submit
- 1Confirm the form is signed by the principal officer authorized to sign.
- 2Verify that all required fields (Lines 1 through 4k) are completed or appropriately marked 'No'.
- 3Ensure Form 5309 is attached directly to Form 5300, Application for Determination for Employee Benefit Plan.
- 4Check the revision date on the form reads January 2012.
- 5Confirm the OMB No. is 1545-0284.
- 6Verify that the plan is designed to invest primarily in employer securities (as per Form 5309 instructions).
- 7Review Line 4a through 4f to ensure all specific plan design questions have been answered accurately.
How to file this form
- 1Complete Lines 1 and 2 with the required Name of plan sponsor and Employer identification number (EIN) on Form 5309.
- 2Answer all applicable questions from Line 4a through 4k, ensuring detailed responses for complex provisions like exempt loan restrictions.
- 3Sign the completed Form 5309 using a wet ink signature by the principal officer authorized to sign. Attach this form to Form 5300.
- 4Mail the package (Form 5309 attached to Form 5300) to the IRS at SE:W:CAR:MP:T:M:S, 1111 Constitution Ave. NW, IR-6526, Washington, DC 20224 for processing.
Known limitations
- 1The questions regarding tax credit ESOPs have been deleted from Form 5309, though a filer must state if their plan involves such a type.
- 2For an S corporation-sponsored ESOP, the form applies to all plan years beginning on or after January 1, 2005, requiring no prohibited allocation of employer stock to a disqualified person for a nonallocation year.
- 3If an employee stock ownership plan (ESOP) was established on or before March 14, 2001, the form applies if the employer maintaining the ESOP had not made an S-corporation election in effect on that date.
Field map
Compact field-by-field guide
General Info
2 items
Full legal name and taxpayer identification number (SSN or EIN).
Current mailing address.
Details
2 items
Complete all applicable sections of this form according to the official IRS instructions.
Enter the relevant dollar amount if this form involves tax calculation.
Certification
1 items
Read and acknowledge any certifications required by this form.
Signatures
1 items
Sign and date. Unsigned forms cannot be processed.
Almost done reviewing the fields?
Fillable formOpen in Editor->The current edition is Revision January 2012 (Rev. January 2012). The IRS maintains a page at www.irs.gov/form5309 where recent developments affecting Form 5309 are posted.
What changed or needs a fresh check
- Edition date — confirm the revision reads January 2012 (Rev. January 2012)
- OMB No. — confirm it is 1545-0284
- Mailing address — use SE:W:CAR:MP:T:M:S, 1111 Constitution Ave. NW, IR-6526, Washington, DC 20224
- Signature — confirm the form is signed by the principal officer authorized to sign (stamped signatures are not acceptable)
Quick Facts
Downloads
After you file
- 1Retain a copy of Form 5309 after filing.
- 2The IRS will use the information to determine whether the plan meets the legal requirements for section 4975(e)(7) approval.
- 3If the application is submitted, it must be accompanied by Form 5300 and a copy of all documents and statements required by those forms.
- 4The principal officer authorized to sign must sign Form 5309 (stamped signatures are not acceptable).
- 5Recordkeeping for this form requires an estimated 6 hours and 13 minutes.
Sources
- SRCForm 5309 (Rev. January 2012) is the Application for Determination of Employee Stock Ownership Plan, applying under section 4975(e)(7) of the Internal Revenue Code [Form p.1].
- SRCThe plan must be attached to Form 5300, Application for Determination for Employee Benefit Plan [Form p.1, Instructions p.3].
- SRCFiling is required if the plan meets requirements under section 4975(e)(7) and applies to plan years ending after March 14, 2001 [Instructions p.3].
- SRCThe application must be signed by the principal officer authorized to sign, and stamped signatures are not acceptable [Form p.3].
- SRCTo receive a determination, submit Form 5309, Form 5300, and copies of all required documents/statements [Form p.3].
- SRCThe general instructions state that if an item provides a box to check, written responses are not acceptable on Form 5309 [Form p.3].
- SRCFor the plan sponsor's EIN, Line 2 requires the Employer identification number (EIN) [Form p.1].
- SRCThe IRS has provided information about Form 5309 and its instructions at www.irs.gov/form5309 [Form p.3].
Common confusion points
Who can file Form 5309?
Any corporate employer who established or amends an ESOP intended to meet section 4975(e)(7) requirements.
→ Check if the plan is new, being amended, or if you are an S corporation.
What must be attached with Form 5309?
Submit Form 5309 along with Form 5300 and a copy of all required supporting documents and statements.
→ Ensure both forms are submitted together.
What is the significance of the plan investing primarily in employer securities?
The plan must be designed to invest primarily in employer securities; for definitions, see section 409(I) or section 4975(e)(8).
→ Confirm this design requirement on Line 4b.
If participants can demand distribution in employer stock, what about the charter/bylaws?
If the answer to question 4d is 'Yes,' then no further answers are needed for that part; if 'No,' check if bylaws restrict ownership and if resales under a fair valuation formula are possible.
→ Review lines 4d (i) carefully.
What font/style must be used when completing Form 5309?
All data input must be entered in Courier 10 point font, with alpha characters in all capital letters and spaces between words.
→ Check the general instructions section for formatting rules.
Can a stamped signature on Form 5309 be accepted?
No; only a principal officer authorized to sign can provide the signature, and stamped signatures are not acceptable (see Rev. Proc. 2012-4).
→ Verify the signature block before mailing.
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⚠ If something goes wrong
- Not stated in the official source — verify on the agency site (though general filing mechanics suggest keeping copies and submitting corrections).
Questions about IRS Form 5309
What is IRS Form 5309 used for?
This form allows an employer to ask the IRS if their Employee Stock Ownership Plan (ESOP) meets all the necessary rules for tax benefits. By filing this, the employer seeks a formal determination letter from the IRS regarding their plan's compliance. The plan must primarily invest in the company's own stock to qualify.
Who must file IRS Form 5309?
Any corporate employer who has established or amends an ESOP intended to meet the requirements under section 4975(e)(7) must file Form 5309. An S corporation-sponsored ESOP must also ensure no prohibited allocation of employer stock is made to a disqualified person for a nonallocation year.
What information does IRS Form 5309 require?
The form collects specific details about the plan, including the Plan Sponsor's EIN and Plan number (Lines 1-3). It asks questions regarding whether the plan qualifies as an ESOP under section 4975(e)(7) and if it meets requirements for leveraged plans (Lines 4a-4k and 5a-5g).
When is IRS Form 5309 due?
The filing is required when a plan is initially established or as a result of a plan amendment. This applies to plan years ending after March 14, 2001.
Where do I file IRS Form 5309?
Form 5309 must be submitted along with Form 5300 and copies of all required supporting documents. The instructions do not specify a single service center but mandate attachment to Form 5300 for filing.
How do I complete IRS Form 5309?
The filer must complete all fields using Courier 10 point font, entering alpha characters in capital letters. The completed Form 5309 must be signed by the principal officer authorized to sign. The form must then be attached to Form 5300 when submitted for review.
What happens if IRS Form 5309 is filed incorrectly?
Filing this information is only required if the filer wishes the IRS to determine qualification under section 4975(e)(7). Failure to file means the plan's status remains undetermined by the agency.
Who can file Form 5309?
Any corporate employer who established or amends an ESOP intended to meet section 4975(e)(7) requirements. Check if the plan is new, being amended, or if you are an S corporation.
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