Application for Determination for Adopters of Master or Prototype or Volume Submitter Plans

Instructions for Form 5307 (Rev. January 2007), Application for Determination for
Adopters of Master or Prototype or Volume Submitter Plans
Purpose: This is the first circulated draft of the Instructions for Form 5307 (Rev.
January 2007), Application for Determination for Adopters of Master or Prototype or
Volume Submitter Plans, for your review and comments. See below for a discussion of
the major changes.
TPCC Meeting: None, but one may be arranged if requested.
Prior Version: The Instructions for Form 5307 (Rev. September 2001) are available at:
http://www.irs.gov/pub/irs-pdf/i5307.pdf
Other Products: Circulations of draft tax forms, instructions, notices, and publications
are posted at: http://taxforms.web.irs.gov/draft_products.html
Comments: Please email, fax, call, or mail any comments by December 12, 2006.

Esther M. Woodworth
Tax Forms and Publications
SE:W:CAR:MP:T:T:FP
Email: Esther.M.Woodworth@irs.gov
Phone: 202-283-4892
NCFB C7-418

Major Changes to the Form 5307, Application for Determination for
Adopters of Master or Prototype or Volume Submitter Plans
Changes due to Rev. Proc. 2005-66, 2005-37 I.R.B. 509:
a. The Instructions for the Form 5307 were expanded to include reference to
Form 8821, Tax Information Authorization, in addition to the Form 2848, Power
of Attorney and Declaration of Representative.
b. The instructions were also expanded to discuss the new Form 8905,
Certification of Intent to Adopt a Pre-approved Plan and that the Form 8905 must
accompany all applications for a determination for adopters of Master or
Prototype or volume submitter plans. Changes involving the Form 8905 occur on
pages 1 (What’s New), 2 (Who May File), and 4 (“What to File”).
On page 1, under “Where to File” address of Covington KY was determined to still be
correct, however the street address alternative was deleted in accordance with the no
street address memo.
On page 2, the approved standardized plan Rev. Proc. was updated from Rev. Proc. 200020 to 2005-16, as modified by Rev. Proc. 2005-66.

On page 3, the private delivery services were updated in accordance with Notice 200483.
On page 4 and 7, the revenue procedure providing guidance for the determination letter
program was updated to Rev. Proc. 2006-6.
On page 6, under Line 1b, additional language was added to explain the various methods
available to get an Employer Identification Number.

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Instructions for Form 5307

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Instructions for Form 5307

Department of the Treasury
Internal Revenue Service

(Rev. January 2007)
Application for Determination for Adopters of
Master or Prototype or Volume Submitter Plans
Section references are to the Internal
Revenue Code unless otherwise noted.

What’s New
Requirements for Switching to
Six-Year Remedial Amendment
Cycle
All applications must be
accompanied by new Form 8905,
Certification of Intent to Adopt a
Pre-approved Plan, if an employer
intends to switch from the five-year
remedial amendment cycle to the
six-year remedial amendment cycle
by meeting one of the eligibility
requirements for the six-year
remedial amendment cycle. For more
information, see Rev. Proc. 2005 –66,
2005 –37 I.R.B. 509.

Disclosure Request by
Taxpayer.

Type of Plan

• A Defined Contribution Plan (DCP)
is a plan that provides an individual
account for each participant and for
benefits based only:
1. On the amount contributed to
the participant’s account, and
2. Any income, expenses, gains
and losses, and any forfeitures of
accounts of other participants that
may be allocated to the participant’s
account.
• A Defined Benefit Plan (DBP) is
any plan that is not a DCP.
A qualified plan must satisfy
section 401(a) including, but
CAUTION not limited to, participation,
vesting, nondiscriminatory
contributions or benefits, distributions,
and contribution and benefit
limitations.

!

Who May File

A taxpayer can authorize the IRS to
disclose and discuss the taxpayer’s
return and/or return information with
any person(s) the taxpayer
designates in a written request. Use
Form 2848, Power of Attorney and
Declaration of Representative, if the
representative is qualified to sign, or
Form 8821, Tax Information
Authorization, for this purpose. See
Pub. 947, Practice Before the IRS
and Power of Attorney for more
information.

This form may be filed by an adopter
of:
• An approved non-standardized
M&P plan,
• An approved volume submitter
plan, or
• An approved standardized plan
under the circumstances described in
Rev. Proc. 2005 –16, as modified by
Rev. Proc. 2005 –66.
See Announcement 2001-77,
2001-30 I.R.B. 83 for exceptions.

Public Inspection.

Standardized Plans

Form 5307 is open to public
inspection if there are more than 25
plan participants. The total number of
participants must be shown on line
4e. See the instructions for line 4e for
a definition of participant.

Standardized plans will generally
satisfy the requirements of sections
410(b) and 401(a)(4) if they follow the
terms of their plan document. Specific
determinations regarding sections
410(b) and 401(a)(4) are not routinely
issued for these plans since a
standardized plan operated in
accordance with its terms will satisfy
the requirements of sections 410(b)
and 401(a)(4).

General Instructions
Purpose of Form
Adopters of Master or Prototype
(M&P) or volume submitter plans file
Form 5307 to request a determination
letter from the IRS for the qualification
of a defined benefit or a defined
contribution plan and the exempt
status of any related trust.

Who May Not File
This form may not be filed to request
a determination letter for:
• An M&P adopter that amends the
plan other than through the choice of
elections offered under the approved
adoption agreement. However, an
Cat. No. 11833J

M&P adopter may amend the
adoption agreement to add overriding
language for sections 415 or 416
because of the aggregation of plans
or may amend the trust or custodial
account document to make any
permitted changes;
• A cash balance plan (use Form
5300, Application for Determination
for Employee Benefit Plan);
• A multiemployer or
multiple-employer plan (use Form
5300);
• An employee stock ownership plan
(ESOP) (attach Form 5309,
Application for Determination of
Employee Stock Ownership Plan, to
Form 5300);
• An individually designed plan
(other than an approved volume
submitter plan) (use Form 5300); or
• A request to determine if you are a
member of an affiliated service group
(use Form 5300);

Where To File
File Form 5307 at the address
indicated below:
Internal Revenue Service,
P.O. Box 192,
Covington, KY 41012 –0192.
Private Delivery Services. In
addition to the United States mail,
you can use certain private delivery
services designated by the IRS to
meet the “timely mailing as timely
filing/paying” rule for tax returns and
payments. These private delivery
services include only the following:
• DHL Express (DHL): DHL Same
Day Service, DHL Next Day 10:40
am, DHL Next Day 12:00 pm, DHL
Next Day 3:00 pm and DHL 2nd Day
Service.
• Federal Express (FedEx): FedEx
Priority Overnight, FedEx Standard
Overnight, FedEx 2Day, FedEx
International Priority, and FedEx
International First.
• United Parcel Service (UPS): UPS
Next Day Air, UPS Next Day Air
Saver, UPS 2nd Day Air, UPS 2nd
Day Air A.M., UPS Worldwide
Express Plus, and UPS Worldwide
Express.

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Instructions for Form 5307

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The private delivery service can
tell you how to get written proof of the
mailing date.

How to Complete the
Application
Applications are screened for
completeness. The application must
be signed by the employer, plan
administrator or authorized
representative. Incomplete
applications may be returned to the
applicant. For this reason, it is
important that an appropriate
response be entered for each line
item (unless instructed otherwise). In
completing the application, pay
careful attention to the following:
• N/A (not applicable) is accepted as
a response only if an N/A block is
provided.
• If a number is requested, a number
must be entered.
• If an item provides a choice of
boxes to check, check only one box
unless instructed otherwise.
• If an item provides a box to check,
written responses are not acceptable.
• Governmental plans and
nonelecting church plans do not have
to complete line 10a.
• The IRS may, at its discretion,
require a plan restatement or
additional information any time it is
deemed necessary.
Rev. Proc. 2006-6 publishes the
guidance under which the
determination letter program is
administered. It is updated annually
and can be found in the Internal
Revenue Bulletin (I.R.B.)
Example. Rev. Proc. 2006-6, 2006-1
I.R.B. 204 superseded Rev. Proc.
2003-6.

What To File

• The appropriate user fee, if

applicable, and Form 8717, User Fee
for Employee Plan Determination
Letter Request. Please submit a
separate check for each application.
Make checks payable to the “United
States Treasury.”
• Schedule Q (Form 5300) Elective
Determination Request. Complete
Schedule Q, if you want to broaden
the scope of a determination letter by
requesting a determination that your
plan satisfies certain qualification
requirements relating to minimum
participation, coverage, and
nondiscrimination. Schedule Q is no
longer mandatory.
• Form 8905, Certification of Intent to
Adopt a Pre-approved Plan, if an
employer intends to switch from the

five-year remedial amendment cycle
to the six-year remedial amendment
cycle by meeting one of the eligibility
requirements for the six-year
remedial amendment cycle.
• All applications for plans that have
at any time in the past received a
favorable determination letter must
include a copy of the plan’s latest
determination letter.
• An opinion letter issued to the plan
must accompany all applications for
adopters of M&P or volume submitter
plans.
• An adoption agreement must be
submitted for M&P plans. Do not
submit a copy of the basic plan
document or trust instrument unless
the plan is an M&P which uses a
separate trust or custodial account
document, in which case such trust or
custodial account document must be
submitted along with the application.
• All applications submitted by
adopters of approved volume
submitter plans must be
accompanied by a copy of the plan
and trust instrument and a written
representation, made by the volume
submitter under penalty of perjury,
which explains if the plan and trust
instrument are or are not
word-for-word identical to the
approved specimen plan and, if not
identical, describes the location,
nature and effect of each difference
from the language of the approved
specimen plan.
• Written authorization allowing the
volume submitter practitioner to act
as a representative of the employer
with respect to the request for a
determination letter.
• All applications submitted by
adopters of approved volume
submitter plans must also be
accompanied by any other
information or material required by
the Service.

Specific Plans—
Additional Requirements
(See Procedural Requirements
Checklist)
• If this application is filed for a
standardized plan, complete only
lines 1 through 5, 7 through 9, and
10c. Explain in a cover letter why the
application is being filed.
• For a governmental or nonelecting
church plan, complete Form 5307 but
skip line 10a. A nonelecting church
plan is a plan for which an election
under section 410(d) has not been
made.
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• For plans of controlled groups of

corporations, trades or businesses
under common control, and affiliated
service groups, submit the statement
specified in the instructions for lines
6a and 6b.
• File Form 5310, Application for
Determination for Terminating Plan,
to request a determination letter for
the complete termination of a DBP or
DCP.
• File Form 5310-A, Notice of
Merger, Consolidation, or Transfer of
Plan Assets or Liabilities, 30 days
prior to a merger, consolidation, or
transfer of plan assets or liabilities.

Specific Instructions
Line 1a. Enter the name, address,
and telephone number of the plan
sponsor/employer. A “plan sponsor”
means:
1. In the case of a plan that covers
the employees of one employer, the
employer;
2. In the case of a plan sponsored
by two or more entities required to be
combined under sections 414(b), (c),
or (m), one of the members
participating in the plan; or
3. In the case of a plan that covers
the employees and/or partner(s) of a
partnership, the partnership.
The name of the plan sponsor/
employer should be the same name
that was or will be used when the
Form 5500 or Form 5500-EZ is filed
for the plan.
Address. Include the suite, room, or
other unit number after the street
address. If the Post Office does not
deliver mail to the street address and
the plan has a P.O. box, show the
box number instead of the street
address. The address should be the
address of the sponsor/employer.
Line 1b. Enter the 9-digit employer
identification number (EIN) assigned
to the plan sponsor/employer. This
should be the same EIN that was or
will be used when the Form 5500 or
Form 5500-EZ is filed for the plan.

!

Do not use a social security
number of the EIN of the trust.

CAUTION

The plan sponsor/employer must
have an EIN. A plan sponsor/
employer without an EIN can apply
for one.
• Online--Generally, a plan sponsor/
employer can receive an EIN by
Internet and use it immediately to file
a return. Go to the IRS website at

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Instructions for Form 5307

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www.irs.gov/businesses/small and
click on Employer ID numbers.
• By telephone —Call
1–800 –829 –4933.
• By mail or fax —Send in a
completed Form SS-4, Application for
Employer Identification Number.
The plan of a group of entities
required to be combined under
section 414(b), (c), or (m) whose
sponsor is more than one of the
entities required to be combined
should only enter the EIN of one of
the sponsoring members. This EIN
must be used in all subsequent filings
of determination letter requests and
annual returns/reports unless there is
a change of sponsor.
Line 1c. Enter the two digits
representing the month the
employer’s tax year ends. This is the
employer whose EIN was entered on
line 1b.
Line 2. The contact person will
receive copies of all correspondence
as authorized in a Power of Attorney
and Declaration of Representative,
Form 2848, or Tax Information
Authorization, Form 8821. Either
complete the contact’s information on
this line, or check the box and attach
a power of attorney or other written
designation.
Line 3a. Enter the number(s) that
correspond to the request(s) being
made.
Enter 1 if the IRS has not issued a
determination letter for this plan.
Enter 2 if the IRS has previously
issued a determination letter for this
plan and enter the date the plan was
signed.
In addition, enter the date the plan
or amendment was signed. If a plan
or amendment is proposed, enter “9/
9/9999.” Enter the effective date
where requested. The term “Date
amendment effective” means the date
the amendment becomes operative
or takes effect.
Enter 3 if this is a standardized
plan. You must also enter a ‘‘1’’ or ‘‘2’’
and the appropriate dates in the
space provided.
Line 3b. If you do not have a copy of
the latest determination letter, or if no
determination letter has ever been
received by the employer, submit
copies of the initial plan (or adoption
agreement), or the latest plan (or
adoption agreement) for which you do
have a determination letter, and any
subsequent amendments and/or
restatements.

Line 3c. Section 3001 of ERISA
requires the applicant to provide
evidence that each employee who
qualifies as an interested party has
been notified of the filing of the
application. If “Yes” is checked, it
means that each employee has been
notified as required by Regulations
section 1.7476-1 or this is a
one-person plan. A copy of the notice
is not required to be attached to this
application. If “No” is checked or this
line is blank, your application will be
returned.
Rules defining ‘‘interested parties’’
and the form of notification are in
Regulations section 1.7476-1. For an
example of an acceptable format, see
Rev. Proc. 2006-6, 2006-1 I.R.B. 204.
Line 4b. Enter the three-digit
number, beginning with ‘‘001’’ and
continuing in numerical order for each
plan you adopt (001-499). This
numbering will differentiate your
plans. The number assigned to a plan
must not be changed or used for any
other plan. This should be the same
number that was or will be used when
the Form 5500 or Form 5500-EZ is
filed for the plan.
Line 4c. Plan year means the
calendar, policy, or fiscal year on
which the records of the plan are
kept.
Line 4e. Enter the total number of
participants. A “participant” means:
1. The total number of
employees participating in the plan
including employees 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. Payment of a deceased
employee’s benefit to three children is
considered a payment to one
beneficiary.
Line 5. Cash balance plan. For this
purpose, a ‘‘cash balance’’ formula is
a benefit formula in a defined benefit
plan by whatever name (For example
personal account plan, pension equity
plan, life cycle plan, cash account
plan, etc.) that rather than, or in
addition to, expressing the accrued
benefit as a life annuity commencing
at normal retirement age, defines
-3-

benefits for each employee in terms
more common to a defined
contribution plan such as a single
sum distribution amount (For example
10 percent of final average pay times
years of service, or the amount of the
employee’s hypothetical account
balance). Use Form 5300 rather than
Form 5307, to request a letter for a
cash balance plan.
Lines 6a and 6b. If the plan
employer is a member of a controlled
group of corporations, trades or
businesses under common control, or
an affiliated service group, all
employees of the group will be
treated as employed by a single
employer for purposes of certain
qualification requirements.
Attach a statement showing in
detail:
1. All members of the group,
2. Their relationship to the plan
employer,
3. The type(s) of plan(s) each
member has, and
4. Plans common to all members.
If you want to apply for a
TIP determination letter to
determine if you are a
member of an affiliated service group,
file Form 5300 instead of Form 5307.
Line 7d. Answer this ‘‘Yes’’ if you
have selected any choice labeled
‘‘Other’’ in the adoption agreement.
Line 9a. If ‘‘Yes’’ is checked, attach a
list for each plan, which includes the
following information:
1. Name of plan,
2. Type of plan,
3. Form of plan (standardized or
nonstandardized),
4. Plan number,
5. Vesting schedule,
6. Whether the plan has received
a determination letter or an
application for a letter is pending with
IRS.
Also indicate if the plan is paired (if
paired, indicate the letter serial
number of the paired plan).
Lines 9b and 9c. See M-8, M-12,
and M-14 of Regulations section
1.416-1.
Line 10a. Section 411(d)(6)
protected benefits include:
• The accrued benefit of a participant
as of the later of the amendment’s
adoption date or effective date; and
• Any early retirement benefit,
retirement-type subsidy or optional
form of benefit for benefits from
service before such amendment.

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Instructions for Form 5307

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If the answer is “Yes,” explain on
an attachment how the amendment
satisfies one of the exceptions to the
prohibition on reduction or elimination
of section 411(d)(6) protected
benefits.

Optional Ratio
Percentage Test
Determination
Line 11. This question may be used
to request an optional determination
regarding the ratio percentage test
under Regulations section
1.410(b)-2(b)(2). If ‘‘No’’ is checked
and a request for a determination
regarding the average benefit test is
not made on Schedule Q, the
determination letter for the plan will
not be a determination regarding
section 410(b). If ‘‘No’’ is checked but
a request for a determination
regarding the average benefit test is
made on Schedule Q, the
determination letter for the plan will
also be a determination regarding the
average benefit test. Plans using the
qualified separate lines of business
rules of section 414(r) must file
Schedule Q if a determination is
desired that the plan satisfies the
gateway test of section 410(b)(5)(B)
or the special requirements for
employer wide plans.
Line 11a. If a determination is being
requested and the plan is
disaggregated into two or more
separate plans, that are other than
profit-sharing and/or sections 401(k)
and/or 401(m) plans, complete lines
11b through 11n with respect to each
disaggregated portion of the plan.
Attach additional schedules as
necessary to identify the other
disaggregated portions of the plan.
Provide the requested coverage
information, in the same format as
line 11, separately with respect to the
other portions of the plan, or to
otherwise show that the other
portions of the plan separately satisfy
section 410(b).
Example. If this plan benefits the
employees of more than one qualified
separate line of business (QSLOB),
the portion of the plan benefiting the
employees of each QSLOB is treated
as a separate plan maintained by that
QSLOB and must separately satisfy
section 410(b) unless the
employer-wide plan testing rule in
Regulations section
1.414(r)-1(c)(2)(ii) applies.
If a determination is being
requested for a section 401(k) and/or

401(m) plan you must complete line
11l for the portion of the plan that is
not a section 401(k) or a 401(m) plan.
Also complete line 11m(1) to report
the ratio percentage for the section
401(k) portion of the plan and line
11m(2) to report the ratio percentage
for the section 401(m) portion of the
plan.
Line 11c. If, for purposes of
satisfying the minimum coverage
requirements of section 410(b), you
are applying the daily testing option in
Regulations section 1.410(b)-8(a)(2)
or the quarterly testing option in
Regulations section 1.410(b)-8(a)(3),
or, if you are using single-day
‘‘snapshot’’ testing as permitted under
section 3 of Rev. Proc. 93-42, 1993-2
C.B. 540, enter the most recent
eight-digit date (MMDDYYYY) for
which the coverage data is submitted.
If you are applying the annual testing
option in Regulations section
1.410(b)-8(a)(4), enter the year for
which the coverage data is submitted.
Line 11d. Include all employees of
all entities combined under sections
414(b), (c), (m), or (o). Also include
all self-employed individuals,
common law employees, and leased
employees as defined in section
414(n) of any of the entities above,
other than those excluded by section
414(n)(5). Certain individuals may
also be required to be counted as
employees. See the definition of
employee in Regulations section
1.410(b)-9. Also see Regulations
section 1.410(b)-6(i), which may
permit the employer to exclude
certain former nonhighly
compensated employees.
Note. This note applies only to
plans that include a qualified cash or
deferred arrangement under section
401(k) or employee or matching
contributions under section 401(m). If
there are any contributions under the
plan that are not subject to the
special rule for section 401(k) plans
and section 401(m) plans in
Regulations section
1.401(a)(4)-1(b)(2)(ii)(B) (such as
nonelective contributions), complete
lines 11e through 11k with respect to
the portion of the plan that includes
these contributions and enter the ratio
percentage for this portion of the plan
on line 11l. Otherwise, complete lines
11e through 11k with respect to the
section 401(k) part of the plan (or the
section 401(m) plan if there is no
section 401(k) arrangement) and
leave line 11l blank. In all cases,
enter the ratio percentages for the
section 401(k) and the section 401(m)
-4-

parts of the plan, as applicable, on
line 11m. These percentages should
be based on the actual
nonexcludables in the 401(k) and
401(m) portions, respectively. It is
suggested that these calculations be
submitted with the application but this
is optional.
If the plan provides for
nonelective profit-sharing
CAUTION contributions, do not base the
calculations on lines 11m(1) and (2)
on the nonexcludable employees
reported on line 11g unless all of the
disaggregated plans (profit-sharing,
401(k), and 401(m)) have the same
nonexcludable employees with the
same age and service requirements.
Line 11e(1). Enter the number of
employees who are excluded
because they have not attained the
lowest minimum age and service
requirements for any employee under
this plan. If the employer is separately
testing the portion of a plan that
benefits otherwise excludable
employees, attach a separate
schedule describing which employees
are treated as excludable employees
on account of the minimum age and
service requirements under each
separate portion of the plan.
Line 11e(2). Enter the number of
employees who are excluded
because they are collectively
bargained employees as defined in
Regulations section 1.410(b)-6(d)(2),
regardless of whether those
employees benefit under the plan.
For this purpose, an employee
covered under a CBA is not
considered a collectively bargained
employee if more than 2% of the
employees who are covered under
the agreement are professional
employees as defined in Regulations
section 1.410(b)-9.
Line 11e(3). Enter the number of
employees who do not receive an
allocation or accrue a benefit under
the plan only because they do not
satisfy a minimum hours of service
requirement or a last day of the plan
year requirement, provided they do
not have more than 500 hours of
service, and they are not employed
on the last day of the plan year. Do
not enter on this line any employees
who have more than 500 hours of
service, even if they are not
employed on the last day of the plan
year.
Line 11e(4). If this plan benefits the
employees of one QSLOB, enter on
this line the number of employees of
the employer’s other QSLOBs. This is

!

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not applicable if the plan is tested
under the special rule for
employer-wide plans in Regulations
section 1.414(r)-1(c)(2)(ii).
Line 11e(5). Enter the number of
employees who are nonresident
aliens who receive no earned income
(as defined in section 911(d)(2)) from
the employer that constitutes income
from sources within the United States
(as defined in section 861(a)(3)).
Line 11g. Subtract the total of lines
11e(1) through 11e(5) as reported on
line 11f from the total employees
reported on line 11d. The result is the
number of ‘‘nonexcludable
employees.’’ These are the
employees who can not be excluded
from the plan for statutory or
regulatory reasons and must be
considered in the calculation of the
ratio percentage even though they
might not ‘‘benefit’’ under the plan. If
they meet the age and service
requirements of section 410 and are
not otherwise excludable employees,
they must be included in this number.
Line 11h. Enter the number of
employees on line 11g who are highly
compensated employees (HCEs) as
defined in section 414(q).
Line 11i. In general, an employee is
treated as benefiting under the plan
for coverage tests purposes only if
the employee receives an allocation
of contributions or forfeitures or
accrues a benefit under the plan for
the plan year. Certain other
employees are treated as benefiting if
they fail to receive an allocation of
contributions and/or forfeitures, or to
accrue a benefit, solely because they
are subject to plan provisions that
uniformly limit plan benefits, such as
a provision for maximum years of
service, maximum retirement
benefits, application of offsets or
fresh start wear-away formulas, or
limits designed to satisfy section 415.
An employee is treated as benefiting
under a plan to which elective
contributions under section 401(k) or
employee contributions and matching
contributions under section 401(m)
may be made if the employee is
currently eligible to make such
elective or employee contributions, or
to receive a matching contribution,
whether or not the employee actually
makes or receives such contributions,
(Regulations section 1.401(k)-1(g)(4)
and 1.401(m)-1(f)(4)). However, do
not apply this rule to determine if an
employee is to be counted as
benefiting for lines 11i and 11k if, in
accordance with the Note following
the instruction for line 11d, the

information provided in lines 11e
through 11k relates to the portion of
the plan that is not subject to the rule
in Regulations section
1.401(a)(4)-1(b)(2)(ii)(B).
Line 11k. See the instructions for
line 11i for the meaning of ‘‘benefiting
under the plan.’’
Line 11l. To obtain the ratio
percentage:
Step 1. Divide the number on line
11k (nonexcludable NHCEs
benefiting under the plan) by the
number on line 11j (nonexcludable
NHCEs).
Step 2. Divide the number on line
11i (nonexcludable HCEs benefiting
under the plan by the number on line
11h nonexcludable HCEs).
Step 3. Divide the result from Step
1 by the result from Step 2.
If the ratio percentage entered
TIP on line 11l and/or line 11m is
less than 70%, the plan does
not satisfy the ratio percentage test.
In this case, the plan must satisfy the
average benefit test. A determination
regarding the average benefit test
can be requested using Schedule Q.
Line 11m. See the Note following the
instructions for line 11d. To determine
the ratio percentages for the section
401(k) and all section 401(m)
(matching and employee contribution)
portions of the plan, follow the steps
described in the instructions for lines
11d through 11l, but treat an
employee as benefiting under the
rules for section 401(k) plans and
section 401(m) plans described in the
instruction for line 11i.

Design-Based
Nondiscrimination Safe
Harbors
Line 12. This question may be used
by certain plans to request an
optional determination regarding the
design-based safe harbor under
section 401(a)(4).
If this is a section 401(k) and/or
section 401(m) plan that does not
contain a provision for nonelective
employer contributions, this option
should be marked “No.”
If any disaggregated plan relies on
a non-design based safe harbor or a
general test this option must be
marked ‘‘No.’’ The Schedule Q may
be used to request a determination
regarding a non-design based safe
harbor or a general test.
-5-

If this plan has been restructured
into component plans, this option
must be marked “No.” The Schedule
Q may be used to request a
determination regarding how each
restructured component plan satisfies
the nondiscrimination in amount
requirement of Regulations section
1.401(a)(4)-1(b)(2).
If “Yes” is checked, or if “No” is
checked but a request for a
determination regarding a non-design
based safe harbor or a general test is
made on Schedule Q, the
determination letter for the plan will
also be a determination regarding the
section 401(a)(4) requirement that a
plan not discriminate in the amounts
of contributions or benefits.
If “No” is checked, and a request
for a determination regarding a
non-design based safe harbor or a
general test is not made on Schedule
Q, the determination letter for the
plan will not be a determination
regarding this requirement, unless the
plan is a section 401(k) and/or
section 401(m) plan only.
Line 12a. Check ‘‘Yes’’ if the plan is
intended to satisfy the permitted
disparity requirements of section
401(I).
Line 12b. To satisfy section 401(l), a
plan must provide that the overall
permitted disparity limits are not
exceeded and specify how
employer-provided contributions or
benefits under the plan are adjusted,
if necessary, to satisfy the overall
permitted disparity limits. See
Regulations section 1.401(l)-5.
Line 12c. This line provides a list of
the design-based nondiscrimination
safe-harbor regulations.

How To Get Forms and
Publications
Internet
You can access the IRS website 24
hours a day, 7 days a week at www.
irs.gov to:
• Download forms, instructions, and
publications;
• Order IRS products on-line;
• Research your tax questions
on-line;
• Search publications on-line by topic
or keyword;
• View Internal Revenue Bulletins
(IRBs) published in the last few years;
and
• Sign up to receive local and
national tax news by email.

Page 6 of 6

Instructions for Form 5307

17:20 - 30-NOV-2006

The type and rule above prints on all proofs including departmental reproduction proofs. MUST be removed before printing.

CD-ROM
You can order Publication 1796, IRS
Tax Products CD-ROM, and obtain:
• A CD that is released twice so you
have the latest products. The first
release ships in late December and
the final release ships in late
February.
• Current-year forms, instructions,
and publications.
• Prior-year forms, instructions, and
publications.
• Tax Map: an electronic research
tool and finding aid.
• Tax law frequently asked
questions.
• Tax topics from the IRS telephone
response system.
• Fill-in, print, and save features for
most tax forms.
• Internal Revenue Bulletins.
• Toll-free and email technical
support.
Buy the CD-ROM from National
Technical Information Service (NTIS)
at www.irs.gov/cdorders for $35 (no
handling fee) or call
1-877-CDFORMS (1-877-233-6767)
toll-free to buy the CD-ROM for $35
(plus a $5 handling fee).

(1-800-829-3676). You can also get
most forms and publications at your
local IRS office.
Paperwork Reduction Act Notice.
We ask for the information on this
form to carry out the Internal
Revenue laws of the United States. If
you want to have your plan approved
by the IRS, you are required to give
us the information. We need it to
determine whether you meet the legal
requirements for plan approval.
You are not required to provide the
information requested on a form that
is subject to the Paperwork Reduction
Act unless the form displays a valid
OMB control number. Books or
records relating to a form or its
instructions must be retained as long
as their contents may become
material in the administration of any
Internal Revenue law. Generally, tax
returns and return information are
confidential, as required by section
6103.
The time needed to complete and
file this form will vary depending on

By Phone and in Person
You can order forms and publications
by calling 1-800-TAX-FORM

-6-

individual circumstances. The
estimated average time is:
Form 5307

Sch. Q (Form
5300)

Recordkeeping

27 hr., 8 min.

6 hr., 13 min.

Learning about
the law or the
form

6 hr., 34 min.

9 hr., 14 min.

Preparing the
form

10 hr., 6 min.

9 hr., 45 min.

Copying,
assembling,
and sending the
form to the IRS

48 min.

If you have comments concerning
the accuracy of these time estimates
or suggestions for making this form
simpler, we would be happy to hear
from you. You can write to the Tax
Products Coordinating Committee,
SE:W:CAR:MP:T:T:SP, 1111
Constitution Ave. NW, IR-6406,
Washington, D.C. 20224.
Do not send any of these forms or
schedules to this address. Instead,
see Where To File on page 1.