Compliance Corner

Retirement Updates

IRS Temporarily Suspends Prototype IRA Opinion Letter Program

March 29, 2022

On March 14, 2022, the IRS announced that, until further notice, they would not accept applications for opinion letters on prototype IRAs (traditional, Roth and SIMPLE IRAs), Small Employer Plans (SEPs) or SIMPLE IRA plans. The IRS will take this time to update the prototype IRA opinion letter program and issue revised model forms, Listings of Required Modifications and related published guidance to reflect recent legislation (such as the SECURE Act).

Until the IRS issues further guidance, previous adopters of prototype IRAs, SEPs and SIMPLE IRAs may rely on their previously received favorable opinion letter. Entities may also use existing model forms to maintain current plans and establish new plans. The pre-approved documents that can be used to establish an IRA, SEP or SIMPLE IRA include:

  • Form 5305, Traditional Individual Retirement Trust Account
  • Form 5305-A, Traditional Individual Retirement Custodial Account
  • Form 5305-R, Roth Individual Retirement Trust Account
  • Form 5305-RA, Roth Individual Retirement Custodial Account
  • Form 5305-RB, Roth Individual Retirement Annuity Endorsement
  • Form 5305-S, SIMPLE Individual Retirement Trust Account
  • Form 5305-SA, SIMPLE Individual Retirement Custodial Account
  • Form 5304-SIMPLE, Savings Incentive Match Plan for Employees of Small Employers (SIMPLE) – Not for Use With a Designated Financial Institution
  • Form 5305-SIMPLE, Savings Incentive Match Plan for Employees of Small Employers (SIMPLE) – For Use With a Designated Financial Institution
  • Form 5305-SEP, Simplified Employee Pension – Individual Retirement Accounts Contribution Agreement; and
  • Form 5305A-SEP, Salary Reduction Simplified Employee Pension – Individual Retirement Accounts Contribution Agreement

The IRS intends to issue a new revenue procedure describing the new procedures for submitting a request for an opinion letter on a prototype IRA, SEP or SIMPLE IRA. The IRS will later announce when applications may be submitted under their revised prototype IRA opinion letter program and when revised model forms must be used.

Plan sponsors looking to establish these types of plans should consult with their service providers during the temporary suspension of the IRS prototype IRA opinion letter program.

IRS Announcement 2022-6 »