Form 5306-A – Opinion Letter Guide for Sponsors

I remember a sponsor telling me they had their prototype SIMPLE IRA ready to submit, only to learn the IRS had paused the opinion letter program.

Their team had already mapped sections to LRMs, drafted clean workpapers, and built a redline pack. The problem was not their effort. It was timing. If you have ever felt that mix of momentum and uncertainty, this guide is for you.

Key takeaways

• Form 5306-A is the IRS application a sponsor uses to request an opinion letter for a prototype SEP under section 408(k) or a prototype SIMPLE IRA plan under section 408(p). You do not adopt a plan with this form.
• As of March 14, 2022, the IRS temporarily suspended accepting 5306-A (and 5306) applications for prototype IRAs, SEPs, and SIMPLE IRA plans. The suspension remains in place “until further notice,” and sponsors may continue to rely on previously issued favorable opinion letters.
• The current 5306-A PDF is Rev. 11-2019. If and when filings resume, confirm the latest revision and instructions before you prepare a package.
• If the program reopens, IRS Employee Plans submission addresses are P.O. Box 12192, Covington, KY 41012-0192 for USPS and 7940 Kentucky Drive, Florence, KY 41042 for private delivery. Always recheck the active address before mailing.
• Employers do not file Form 5306-A. They adopt a model document, such as Forms 5304-SIMPLE, 5305-SIMPLE, 5305-SEP, or 5305A‑SEP, or they adopt an IRS‑approved prototype from a sponsor.

What Form 5306-A is, and what it is not

Form 5306-A is the sponsor’s application for an IRS opinion letter on the form of a prototype SEP or SIMPLE IRA plan. It is not an adoption agreement for an employer and it is not a determination letter on a specific employer’s plan. It is a conformity review of your prototype document’s language against the Code and guidance. When the program is open, the resulting opinion letter provides reliance on the form of your document, subject to any limits stated in the letter.

Because employers often ask, a quick contrast helps:

• Adoption, funding, and day‑to‑day operations happen under model documents or approved prototypes.
• 5306-A is how a bank, insurer, broker‑dealer, mutual fund family, or similar institution gets the IRS to say the prototype language meets the rules in sections 408(k) or 408(p).

2025 program status at a glance

The prototype IRA opinion letter program is paused. Sponsors may rely on prior favorable letters and continue to use existing model forms while the IRS updates the program for recent legislation, including SECURE and SECURE 2.0.

Here is the most important practical update for your team in 2025:

• The IRS temporarily suspended accepting applications for 5306 and 5306‑A effective March 14, 2022, and has reiterated that suspension in subsequent annual revenue procedures. The IRS will announce when applications may be submitted under a revised program. Keep monitoring the Announcements page and annual procedures.
• The “About Form 5306‑A” page remains live for background and links to the form PDF, but shows no new developments. Treat it as reference, not a green light to file.

Who should use this form when filings resume

If you sponsor a prototype SEP or SIMPLE IRA plan document used by many employers, Form 5306‑A is your path to an IRS opinion letter. Typical eligible sponsors include banks and trust companies, insurance companies, regulated investment companies, broker‑dealers, mutual fund platforms, and associations that publish standardized prototype documents. Individual employers do not file 5306‑A.

SEP versus SIMPLE, in sponsor terms

• Choose the SEP track when your prototype reflects an employer‑funded arrangement under section 408(k).
• Choose the SIMPLE IRA track when your prototype supports salary deferrals with employer contributions for small employers that generally have 100 or fewer employees.
• If an employer simply needs a plan, they typically use model Forms 5305‑SEP or 5305A‑SEP for SEP, or 5304‑SIMPLE or 5305‑SIMPLE for SIMPLE, or they adopt your already approved prototype.

Quick comparison table

Item	SEP prototype (408(k))	SIMPLE IRA prototype (408(p))
Employee deferrals	Not typical for new SEPs	Yes, salary reduction with annual limits
Employer funding	Employer contributions	3% match or 2% nonelective is common
Typical employer size	Any	Generally 100 or fewer employees
Employer filing 5306‑A?	No, sponsor files	No, sponsor files

As a sponsor, you will map each substantive provision in your prototype to LRMs and cite article and page references in your submission. That mapping makes the IRS review faster and protects your review time later.

Why so many sponsors get stuck

From what I see, the biggest friction is not writing the prototype. It is operational discipline. Teams rush workpapers, skip naming standards, and bury reviewers in back‑and‑forth because the document set is not packaged for a clean first read. That costs you weeks. A small investment in document hygiene, internal SLAs, and a consistent review ladder often cuts revision cycles in half.

If your accounting or tax delivery engine already runs on SOPs, standardized workpapers, and predictable turnaround, you feel the relief. If not, borrow from the best practices below. This is exactly the kind of discipline Accountably brings to production work for firms, which is why our clients ask us to set up the same controls on their internal projects too. Keep it minimal, keep it rigorous.

How the opinion letter process works, step by step

When the IRS reopens the program, expect a familiar flow. Here is the practical, field‑tested checklist sponsors use to move from draft to decision.

1. Build the right document set

• Prototype plan document and all appendices or addenda.
• Amendments with an explanation of changes and where they slot into the base document.
• Crosswalk to LRMs, citing article or section and page for every required provision.
• Clean and redline versions to simplify reviewer attention.

2. Confirm fees and pay correctly

• User fees apply to opinion letter requests. The fee schedule and procedures are published annually in the Employee Plans revenue procedure. Check the current year before paying.

3. Verify the current mailing instructions

• If the program reopens and paper submissions are in play, addresses used by Employee Plans include P.O. Box 12192, Covington, KY 41012‑0192 for USPS and 7940 Kentucky Drive, Florence, KY 41042 for private delivery. Always confirm the active address on IRS.gov the week you ship.

4. Assign ownership and deadlines

• Give one owner authority over the submission packet, internal SLAs, and issue logs.
• Use a three‑layer review ladder, such as preparer, senior, and quality reviewer, before executive sign‑off. This protects partner time and stops avoidable rework.

5. Track status and keep a clean trail

• Maintain a single source folder with dated versions and a submission checklist.
• Record every IRS correspondence item, date, and requested change.

Where to get the form and instructions

• The current PDF for Form 5306‑A is Rev. 11‑2019. Download it from IRS.gov when you are ready to prepare, and recheck for a newer revision before you assemble your packet.
• The “About Form 5306‑A” page hosts links to the latest revision and related items. It is also where the IRS will post future updates.

What to do during the suspension

While the opinion letter program is paused, sponsors still have work to do.

• Keep your prototype current and internally approved. Map SECURE and SECURE 2.0 changes with clear redlines and explanations.
• Maintain reliance. The IRS confirms that adopters may rely on previously issued favorable opinion letters while the program is suspended.
• Use IRS model forms to establish new arrangements if needed, including 5304‑SIMPLE, 5305‑SIMPLE, 5305‑SEP, and 5305A‑SEP.
• Watch the IRS Announcements page and the annual revenue procedure for the reopening notice and any revised procedures.

SEP vs. SIMPLE, model choices and limits employers ask about

Employers often ask sponsors content questions while they wait for program reopening. Two items come up the most in 2025.

• SIMPLE IRA employee deferral limit is 16,500 for 2025, with a standard catch‑up of 3,500 at age 50 or older. SECURE 2.0 also adds a higher catch‑up for ages 60 to 63, which is 5,250 in 2025.
• For certain “applicable SIMPLE” plans, a higher basic deferral cap applies. For 2025 that higher amount is 17,600. Plan eligibility rules apply, so sponsors should publish plain‑English eligibility notes for employers.

Addresses and packaging, ready format

If the program reopens with paper submissions still in scope, use a sponsor‑friendly cover page that includes:

• Plan type and whether the submission is initial or amendment.
• Contact person, direct phone, and email.
• User fee payment details and confirmation.
• A numbered list of enclosures.
• A clean LRM crosswalk and a clear redline legend.

Tip from the review chair: clarity on the first page reduces questions later. A one‑page “what changed” summary can save a week.

Process discipline, briefly

If your firm struggles with version chaos or review bottlenecks, put structure first. Standard naming, a single truth folder, and a clear review ladder reduce friction. This is the same delivery architecture we promote with accounting teams, because it protects partner time and makes deadlines predictable.

FAQs sponsors and advisors ask

Does 5306‑A let an employer adopt a plan?

No. Employers adopt model forms or IRS‑approved prototypes. Form 5306‑A is only for sponsors who seek an IRS opinion letter on the form of their prototype SEP or SIMPLE IRA plan.

Is the IRS accepting 5306‑A applications right now?

No. The IRS suspended accepting applications for prototype IRAs, SEPs, and SIMPLE IRA plans effective March 14, 2022, and has restated that suspension in later guidance. The Service will announce when applications may be submitted under a revised program.

Where would I send a package if the program reopens?

For EP submissions, the IRS lists USPS to P.O. Box 12192, Covington, KY 41012‑0192 and private delivery to 7940 Kentucky Drive, Florence, KY 41042. Confirm the active address the day you mail.

What is Form 5329 used for?

Form 5329 is where individuals figure certain additional taxes on retirement distributions, such as early distribution penalties, missed RMD excise taxes, and excess contribution penalties. It can be filed with a tax return or separately for the applicable year. See the form instructions for the parts you need.

At what age can someone take money from a 401(k) without the 10 percent early distribution tax?

Generally at 59½. Many employer plans allow penalty‑free distributions at age 55 if you separate from service in or after the year you turn 55, often called the rule of 55. Plans may offer other exceptions like disability or substantially equal periodic payments. Always check plan terms and the Code rules before acting.

What does the IRS mean by a “qualified retirement plan”?

Qualified plans meet Code requirements and get favorable tax treatment. They include defined benefit plans and defined contribution plans like 401(k), profit‑sharing, and money purchase plans. SEPs and SIMPLE IRAs are IRA‑based arrangements with their own statutory rules, not qualified plans under section 401(a), but employers still follow IRS plan document and contribution requirements.

Can employees deduct SIMPLE IRA contributions on their taxes in 2025?

Employee salary deferrals to a SIMPLE IRA reduce taxable wages for income tax purposes. The basic deferral limit is 16,500 in 2025, with a 3,500 catch‑up at 50+, and a higher 5,250 catch‑up for ages 60 to 63. Certain applicable SIMPLE plans allow a higher basic limit of 17,600 in 2025. Payroll tax treatment and deposit timing rules apply.

Sponsor checklist you can copy

• Confirm program status and any new revenue procedure.
• Stabilize your prototype text, then prepare clean and redline sets.
• Build an LRM crosswalk with article and page references.
• Draft a one‑page change summary for reviewers.
• Verify user fee and payment method for the then‑current year.
• Validate the mailing address and shipping method.
• Assign a single owner, due dates, and an issue log.
• Run a three‑layer internal review before executive sign‑off.
• Keep a submission archive with all correspondence.

Resources

• About Form 5306‑A and current PDF. Use the IRS page as your canonical source for the form and revision dates.
• Prototype IRA program status. Read Announcement 2022‑6 and the annual revenue procedure section that continues the suspension notice.
• Employee Plans submission addresses. Check the current EP address page before you mail.
• SIMPLE IRA limits and catch‑up rules for 2025. Confirm base and higher limits, including the special catch‑up for ages 60 to 63.

A quick word on delivery discipline

If you lead an accounting firm or plan document team, you already know the real bottleneck is delivery, not demand. Clean workpapers, standard file naming, layered reviews, and predictable SLAs turn stressful filings into normal work. That is how we run production for firms. If you want help building that same control into your back office, our team at Accountably can set up disciplined offshore delivery that fits your templates, tools, and review style, then get out of your way.