Form 5309

(Rev. January 2012)

Department of the Treasury 

Internal Revenue Service

Application for Determination of 

Employee Stock Ownership Plan 

(Under section 4975(e)(7) of the Internal Revenue Code)

▶ Attach to Form 5300.

OMB No. 1545-0284

For IRS Use Only

1 Name of plan sponsor (employer if single-employer plan)

2 Employer identification number (EIN) 3 Plan number

All Plans (Complete lines 4a through 4k.)

Yes No

4a Is the plan designated as an employee stock ownership plan (ESOP) within the meaning of section 4975(e)(7)?

b Is the plan designed to invest primarily in employer securities as defined in section 409(l)?

c Is each participant or beneficiary entitled to direct the plan to vote the allocated securities as required by section 

409(e)?

d Does the plan provide that each participant who is entitled to a distribution from the plan has a right to demand 

that the benefit be distributed in the form of employer securities?

If the answer to d is “No,” please answer the following questions:

(i) If the charter or bylaws of the corporation restrict substantially all outstanding stock ownership to employees or to 

a 401(a) trust, does the plan provide that participants are entitled to receive distributions in cash, except that such 

plan may distribute employer securities subject to a requirement that such securities may be resold to the 

employer under a fair valuation formula? (See section 409(h)(2))

(ii) If the plan is maintained by an S corporation, does the plan provide that participants are entitled to receive 

distributions in cash, except that such plan may distribute employer securities subject to a requirement that such 

securities may be resold to the employer under a fair valuation formula? (See section 409(h)(2))

e If the plan is established and maintained by a bank which is legally prohibited from redeeming or purchasing its 

stock, does the plan provide that participants are entitled to receive distributions in cash? (See section 409(h)(3))

f If the trust makes a distribution in stock and the securities are not readily tradable on an established market, can 

the participant require the employer to repurchase the securities under a fair valuation formula within the time 

frames prescribed by law? (See section 409(h)(1)(B))

g If the plan holds employer securities consisting of stock in an S corporation, does the plan provide that no portion 

of the assets of the plan attributable to (or allocable in lieu of) such employer securities may, during a 

nonallocation year, accrue (or be allocated directly or indirectly under any section 401(a) plan of the employer) for 

the benefit of any disqualified person? (See section 409(p))

h Does the plan provide that a qualified participant may elect to diversify a portion of his or her account investment 

in employer securities, as described in section 401(a)(28)(B)? 

If the answer to h is “No,” please answer the following question: 

(i) Does the plan provide that an applicable individual may elect to diversify a portion of his or her account 

investment in employer securities as described in section 401(a)(35)? 

i With respect to activities that are carried on by the plan, are all valuations of employer securities acquired after 

December 31, 1986, which are not readily tradable on an established securities market, made by an independent 

appraiser? (See section 401(a)(28)(C))

For Paperwork Reduction Act Notice, see instructions. Cat. No. 11835F Form 5309 (Rev. 1-2012)
Form 5309 (Rev. 1-2012) Page 2 

Yes No

j Does the plan provide that a participant may begin receiving a distribution of his or her account that is attributable 

to employer securities after the participant has separated from service upon reaching normal retirement age, or after 

death, disability, or other separation from service, within the time frames specified in section 409(o)?

k If the plan is maintained by a C corporation, does the plan provide that the assets of the plan attributable to (or 

allocable in lieu of) employer securities acquired by the plan in a sale to which section 1042 applies cannot accrue 

(or be allocated directly or indirectly under any section 401(a) plan of the employer) for the benefit of persons 

specified in section 409(n) during the nonallocation period? 

Plans Applying Under Section 4975(d)(3) and Regulations Section 54.4975-7 (Leveraged ESOPs) (Complete lines 5a through 5g.)

5a Does the plan provide that the exempt loan proceeds must be used within a reasonable time to acquire qualifying 

employer securities, repay such loan, or repay a prior loan as required under Regulations section 54.4975-7(b)(4)?

b Does the plan provide for the establishment and maintenance of a suspense account as required under Regulations 

section 54.4975-11(c)?

c Does the plan provide that the collateral must be limited to qualifying employer securities purchased with such 

exempt loan or qualifying employer securities used as collateral on a prior exempt loan repaid with the proceeds of 

the current exempt loan as required under Regulations section 54.4975-7(b)(5)?

d Does the plan provide that no person entitled to payment under an exempt loan shall have any right to assets of the 

ESOP other than collateral given for such loan, contributions (other than contributions of employer securities) made 

to repay such exempt loan, and earnings attributable to such collateral and the investment of such contributions as 

required under Regulations section 54.4975-7(b)(5)?

e Does the plan provide that payments made with respect to an exempt loan by the ESOP during the year must not 

exceed an amount equal to the sum of contributions and earnings received during or prior to such year less such 

payments in prior years as required under Regulations section 54.4975-7(b)(5)?

f Do plan terms provide that qualifying employer securities will be forfeited only after other assets as required under 

Regulations section 54.4975-11(d)(4)?

g Does the plan provide that the protections and rights provided to participants and beneficiaries with respect to 

employer securities are nonterminable as required in Regulations section 54.4975-11(a)(3)(i) and (ii)?

Under penalties of perjury, I declare that I have examined this application, including accompanying statements and schedules, and to the best of my 

knowledge and belief, it is true, correct, and complete.

SIGN HERE ▶ Date ▶

Type or print name Type or print title

Form 5309 (Rev. 1-2012)
Form 5309 (Rev. 1-2012) Page 3 

What's New

The IRS has created a page on 

IRS.gov for information about 

Form 5309 and its instructions, at 

www.irs.gov/form5309. Information 

about any recent developments 

affecting Form 5309 will be posted 

on that page.

General Information

Section references are to the Internal 

Revenue Code unless otherwise 

noted.

Use this form to apply for a 

determination letter for an employee 

stock ownership plan (ESOP) that 

meets the requirements of section 

4975(e)(7). Attach Form 5309 to 

Form 5300, Application for 

Determination for Employee Benefit 

Plan.

The plan you establish must be 

designed to invest primarily in 

employer securities. For a definition 

of employer securities and how it 

applies to your plan, see section 

409(I) or section 4975(e)(8). Also see 

Regulations section 54.4975-11 for 

the formal plan requirements of an 

ESOP.

More information. For more 

information about the latest 

developments on Form 5309 and its 

instructions, go to www.irs.gov/

form5309.

General Instructions

A Change To Note

The questions with regard to tax 

credit ESOPs have been deleted. If 

your plan involves such a plan, 

please state so in the cover letter 

and refer to Regulations section 

1.46-8(d) for the formal requirements 

of a tax credit ESOP. The question 

relating to type of plan has been 

deleted from the form.

Who May File

1. Any corporate employer who 

has established an ESOP intended 

to meet the requirements under 

section 4975(e)(7). 

2. Any corporate employer who 

amends an ESOP under section 

4975(e)(7).

An S corporation-sponsored ESOP 

must provide that no prohibited 

allocation of employer stock may be 

made to a disqualified person for a 

nonallocation year. This applies to all 

plan years beginning on or after 

January 1, 2005. This applies to plan 

years ending after March 14, 2001, if:

1. The ESOP was established after 

March 14, 2001, or

2. The ESOP was established on 

or before March 14, 2001, if the 

employer maintaining the ESOP had 

not made an S-corporation election 

in effect on such date.

How To Complete the Application

• If a number is requested, a number 

must be entered.

• If an item provides a box to check, 

written responses are not 

acceptable.

• The application has formatted 

fields that will limit the number of 

characters entered per field.

• All data input will need to be 

entered in Courier 10 point font.

• Alpha characters should be 

entered in all capital letters.

• Enter spaces between any words. 

Spaces do not count as characters.

What To File

To receive a determination on 

whether a plan, initially or as a result 

of a plan amendment, meets the 

requirements of section 4975(e)(7), 

submit Form 5309, Form 5300, and 

a copy of all documents and 

statements required by those forms. 

Attach the completed Form 5309 to 

Form 5300.

Signature

Form 5309 must be signed by the 

principal officer authorized to sign.

Note. Stamped signatures are not 

acceptable; see Rev. Proc. 2012-4, 

2012-1 I.R.B. 125, at www.irs.gov/

pub/irs-irbs/irb12-01.pdf.

Paperwork Reduction Act Notice. 

We ask for the information on this

form to determine whether you meet

the legal requirements for the plan

approval you request. Your filing of

this information is only required if you 

wish the IRS to determine if your plan 

qualifies under section 4975(e)(7).

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 

individual circumstances. The 

estimated average time is:

Recordkeeping . . 6 hr., 13 min.

Learning about the 

law or the form . . 2 hr., 10 min.

Preparing and 

sending the form 

to the IRS . . . . 2 hr., 22 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 

Internal Revenue Service, Tax 

Products Coordinating Committee, 

SE:W:CAR:MP:T:M:S, 1111 

Constitution Ave. NW, IR-6526, 

Washington, DC 20224.