SUPPORTING STATEMENT
Internal Revenue Service
Form 5305-SEP, Simplified Employee Pension—Individual
Retirement Accounts Contribution Agreement
OMB Control Number 1545-0499
CIRCUMSTANCES NECESSITATING COLLECTION OF INFORMATION
Internal Revenue Code (IRC) section 408(k) allows employers to establish a Simplified Employee Pension (SEP) and IRC section 404(h) allows an income tax deduction for contributions to this plan. Form 5305-SEP is used by an employer to establish a SEP under IRC 408(k).
USE OF DATA
Form 5305-SEP is used by employers to make an agreement to provide benefits to all eligible employees under a simplified employee pension (SEP). It provides an easy way to make contributions toward employees' retirement income. The form is not to be filed with the IRS, but a copy is to be kept in the employer’s records.
USE OF IMPROVED INFORMATION TECHNOLOGY TO REDUCE BURDEN
Form 5305-SEP is available electronically.
EFFORTS TO IDENTIFY DUPLICATION
The information obtained through this collection is unique and is not already available or use or adaption from another source.
METHODS TO MINIMIZE BURDEN ON SMALL BUSINESSES OR OTHER SMALL ENTITIES
The IRS proactively works with both internal and external stakeholders to minimize the burden on small businesses, while maintaining tax compliance. The Agency also seeks input regarding the burden estimates from the public via notices and tax product instructions. This form can be accessed electronically, which further reduces any burden to small businesses.
CONSEQUENCES OF LESS FREQUENT COLLECTION ON FEDERAL PROGRAMS OR POLICY ACTIVITIES
The information required is needed to verify compliance with Sections 408(k) of the Internal Revenue Code of the Treasury Regulations. A less frequent collection of taxes and tax information could adversely affect the government’s effectiveness and would reduce the oversight of the public in ensuring compliance with Internal Revenue Code and hinder the IRS from meeting its mission.
SPECIAL CIRCUMSTANCES REQUIRING DATA COLLECTION TO BE INCONSISTENT WITH GUIDELINES IN 5 CFR 1320.5(d)(2)
There are no special circumstances requiring data collection to be inconsistent with Guidelines in 5 CFR 1320.5(d)(2).
CONSULTATION WITH INDIVIDUALS OUTSIDE OF THE AGENCY ON AVAILABILITY OF DATA, FREQUENCY OF COLLECTION, CLARITY OF INSTRUCTIONS AND FORMS, AND DATA ELEMENTS
In response to the Federal Register notice dated June 2, 2021 (86 FR 29627), IRS received no comments during the comment period regarding Form 5305-SEP.
EXPLANATION OF DECISION TO PROVIDE ANY PAYMENT OR GIFT TO RESPONDENTS
No payment or gift has been provided to any respondents.
ASSURANCE OF CONFIDENTIALITY OF RESPONSES
Generally, tax returns and tax return information are confidential as required by 26 U.S.C. 6103.
JUSTIFICATION OF SENSITIVE QUESTIONS
Form 5305-SEP is not sent to the IRS, it is retained by the employer. No personally identifiable information (PII) is collected by the IRS.
ESTIMATED BURDEN OF INFORMATION COLLECTION
The estimated burden:
Form |
Description |
Number of Respondents |
Number of Responses Per Respondent
|
Total Annual Responses |
Hours Per Response |
Total Burden |
5305 SEP |
Simplified Employee Pension—Individual Retirement Accounts Contribution Agreement |
100,000 |
1 |
100,000 |
4.95 |
495,000 |
ESTIMATED TOTAL ANNUAL COST BURDEN TO RESPONDENTS
To ensure more accuracy and consistency across its information collections, IRS is currently in the process of revising the methodology it uses to estimate burden and costs. Once this methodology is complete, IRS will update this information collection to reflect a more precise estimate of burden and costs.
ESTIMATED ANNUALIZED COST TO THE FEDERAL GOVERNMENT
To ensure more accuracy and consistency across its information collections, IRS is currently in the process of revising the methodology it uses to estimate burden and costs. Once this methodology is complete, IRS will update this information collection to reflect a more precise estimate of burden and costs.
REASONS FOR CHANGE IN BURDEN
There is no change in the paperwork burden previously approved by OMB. IRS is making this
submission to renew the OMB approval.
PLANS FOR TABULATION, STATISTICAL ANALYSIS AND PUBLICATION
There are no plans for tabulation, statistical analysis, and publication.
REASONS WHY DISPLAYING THE OMB EXPIRATION DATE IS INAPPROPRIATE
IRS believes that displaying the OMB expiration date is inappropriate because it could cause confusion by leading taxpayers to believe that the form sunsets as of the expiration date. Taxpayers are not likely to be aware that the Service intends to request renewal of the OMB approval and obtain a new expiration date before the old one expires.
EXCEPTIONS TO THE CERTIFICATION STATEMENT
There are no exceptions to the certification statement for this collection.
Note: The following paragraph applies to all of the collections of information in this submission:
An agency may not conduct or sponsor, and a person is not required to respond to, a collection of information unless the collection of information displays a valid OMB control number. Books or records relating to a collection of information must be retained as long as their contents may become material in the administration of any internal revenue law. Generally, tax returns and tax return information are confidential, as required by 26 U.S.C. 6103.
File Type | application/vnd.openxmlformats-officedocument.wordprocessingml.document |
Author | Wolfgang, Dawn |
File Modified | 0000-00-00 |
File Created | 2021-11-02 |