Form 5310 Filing Requirements for Terminating Plans: Fees and Review

Form 5310 filing requirements center on four things: giving written notice to interested parties in a narrow pre-filing window, assembling a complete document package, submitting it electronically through Pay.gov with the correct user fee, and meeting the deadlines for full vesting and asset distribution that surround the filing itself. The form, titled “Application for Determination for Terminating Plan,” asks the IRS to confirm that a retirement plan met the qualification requirements of Internal Revenue Code Section 401(a) or 403(a) through its final day; Section 403(b) plans may also use it.¹² Filing is voluntary, but the favorable determination letter it produces is the only formal IRS confirmation that the trust kept its tax-exempt status and that distributions qualify for tax-free rollovers.

Who Should File

Individually designed plans should almost always file, because they don’t carry the built-in IRS approval that comes with a pre-approved document. Plans with complex operational histories, prior qualification failures corrected through the Employee Plans Compliance Resolution System, or terminations triggered by mergers and acquisitions also gain real value from the letter.³

Sponsors of pre-approved plans (master and prototype or volume submitter documents) can generally rely on the Opinion or Advisory Letter that the IRS already issued to the document provider, provided the plan operated within the terms of that document. For most straightforward pre-approved plan terminations, a separate Form 5310 filing isn’t necessary.

There is a practical reason to file even when the plan looks clean. Submitting Form 5310 extends the one-year window the IRS uses to judge whether assets were distributed “as soon as administratively feasible.” Without the filing, a distribution that takes longer than a year after termination is presumed late, which can push the plan back into ongoing status with every compliance duty that comes with it.⁴

When You Have to File

For a filing to count as termination-related, Form 5310 must be submitted no later than one year after either the effective date of termination or the date the employer formally adopted the termination action, whichever is later. Regardless of those dates, the application cannot be filed more than 12 months after substantially all plan assets have been distributed.²

Full Vesting Kicks In Immediately

Every affected participant becomes 100% vested in accrued benefits the moment the plan terminates, regardless of where they stood on the plan’s vesting schedule. This is a statutory requirement under IRC Section 411(d)(3), not a best practice.⁵ A participant who was 40% vested last month is fully vested now.

The same rule applies if the IRS treats what happened as a partial termination. Failing to accelerate vesting is one of the most common and costly errors in plan terminations.

Notice to Interested Parties

Before you submit Form 5310, written notice must go to every “interested party” within a strict timing window: no fewer than 10 days and no more than 24 days before the application is filed.⁶ Miss that window in either direction and you’ll need to re-notice and delay the filing.

For a termination, interested parties include all current employees with accrued benefits, all former employees with vested benefits, and all beneficiaries of deceased participants currently receiving benefits. The notice itself must contain:

The plan name, plan number, plan administrator name, and the applicant’s taxpayer identification number.
A statement that the application relates to a plan termination, the address where it is being sent, and whether the IRS previously issued a determination letter for the plan.
A description of who is eligible to participate in the plan.
A statement that any interested party can submit comments to the IRS, or ask the Department of Labor to do so, on whether the plan meets qualification requirements, along with the deadline for those comments.

You also have to make the plan document, trust agreement, and a copy of the determination letter application available to interested parties who want to review them.

Building the Application Package

Everything must be consolidated into a single PDF (15 MB maximum) for upload through Pay.gov. If the documents exceed 15 MB, you can fax the overflow to 844-255-4818 with your Pay.gov tracking ID on the cover sheet.² The required attachments:

The plan document and all amendments. For individually designed plans, include amendments through the current Required Amendments List. For pre-approved plans, include the adoption agreement and all amendments since the last determination letter.
A copy of the plan’s most recent favorable determination letter, or the Opinion or Advisory Letter for a pre-approved plan.
Copies of any closing agreements or compliance statements issued for the plan after the last determination letter.
Copies of all corporate resolutions or other records of the actions taken to terminate the plan.
A statement explaining how any amendments affect the terminating plan or any other plan the employer maintains.
Form 6088 for all defined benefit plans and underfunded defined contribution plans, showing the calculation of each participant’s distributable benefits.⁷
Form 2848 or Form 8821, only if a representative or authorized third party is submitting the application on behalf of the sponsor.⁸

Filing Through Pay.gov and the User Fee

Form 5310 must be submitted electronically. Paper submissions are not accepted.¹ Register for a Pay.gov account, search for “5310,” complete the form online, upload the consolidated PDF, and pay the user fee electronically in the same transaction. An email confirmation with a tracking ID follows.

The user fee is set each year by the IRS in its annual Revenue Procedure governing determination letter requests. The fee varies by plan type, and submitting the wrong amount will get the package returned. Check the current schedule on the IRS user fees page before filing.⁹

The 60-Day Review Hold

Once the IRS logs a complete application, it won’t issue a determination letter for at least 60 days. That hold gives interested parties, the Department of Labor, and the Pension Benefit Guaranty Corporation time to submit comments on the plan’s qualified status.¹⁰ The clock runs from the IRS control date. If no comments arrive, the application moves into the normal review queue; processing time beyond the hold depends on IRS workload and plan complexity.

Distributing Plan Assets

Terminating a plan on paper is only half the job. The IRS expects all plan assets to be distributed to participants “as soon as administratively feasible” after the termination date, and generally treats any distribution completed within one year of that date as meeting the standard.¹¹

Miss the one-year window without distributing assets and the plan is presumed to still be ongoing. It has to keep satisfying every qualification requirement under IRC Section 401(a), meet minimum funding obligations under Sections 412 and 430 where applicable, and continue filing annual returns and actuarial reports.⁴

Form 5500 annual returns continue every year until the final distribution is made. The return for the year in which the last assets leave the plan is marked as the final return.¹²

Extra Steps for Defined Benefit Plans

Single-employer defined benefit plans carry a parallel set of Pension Benefit Guaranty Corporation requirements on top of the IRS process. A standard termination (one where plan assets are enough to pay all benefits) follows a specific sequence:

Issue the Notice of Intent to Terminate to all affected parties at least 60 days, but no more than 90 days, before the proposed termination date.
Give each participant, beneficiary, and alternate payee a Notice of Plan Benefits detailing their specific benefits, no later than the date PBGC Form 500 is filed.
File PBGC Form 500, including the enrolled actuary’s certification (Schedule EA-S), no later than 180 days after the proposed termination date.
Allow the PBGC 60 days after receiving a complete Form 500 to review the termination for compliance.
Distribute plan assets by the later of 180 days after the PBGC’s 60-day review period expires, or 120 days after receiving a favorable IRS determination letter (if the determination letter request was filed by the time Form 500 was submitted).
File PBGC Form 501, the post-distribution certification, within 30 days after the last distribution to any participant.

¹³

To keep the extended distribution deadline tied to your IRS determination letter, submit Form 5310 to the IRS no later than the date you file Form 500 with the PBGC. Miss that coordination point and the longer window is lost. The PBGC can assess penalties of $25 per day for late Form 501 filings if the certification arrives more than 90 days after the distribution deadline.¹⁴

When the IRS Decides You Terminated Part of the Plan

A plan sponsor doesn’t always choose termination. Under Revenue Ruling 2007-43, if 20% or more of plan participants experience an employer-initiated severance during an applicable period, a rebuttable presumption of partial termination arises.¹⁵ “Employer-initiated severance” reaches beyond layoffs to include terminations for cause and departures caused by economic downturns.

The presumption can be rebutted by showing the departures were purely voluntary, or that the turnover rate was routine compared with other periods and departed employees were replaced. The burden falls on the plan sponsor. When a partial termination is found, all affected participants become fully vested in their accrued benefits.⁵

1
Internal Revenue Service. About Form 5310, Application for Determination for Terminating Plan
2
Internal Revenue Service. Instructions for Form 5310 – Application for Determination for Terminating Plan
3
Internal Revenue Service. Correcting Plan Errors – Self-Correction Program (SCP) General Description
4
Internal Revenue Service. Plan Termination – Failure to Timely Distribute Assets
5
Office of the Law Revision Counsel. 26 USC 411 – Minimum Vesting Standards
6
Internal Revenue Service. Retirement Plan Notices to Interested Parties
7
Internal Revenue Service. Form 6088 – Distributable Benefits From Employee Pension Benefit Plans
8
Pay.gov. Application for Determination Upon Termination
9
Internal Revenue Service. User Fees for Employee Plans Determination, Opinion and Advisory Letters
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Internal Revenue Service. IRM 7.11.1 Employee Plans Determination Letter Program
11
Internal Revenue Service. Retirement Plans FAQs Regarding Plan Terminations
12
Internal Revenue Service. Form 5500 Plan Terminations Without a Form 5310 Filing
13
Pension Benefit Guaranty Corporation. Standard Termination Filing Instructions
14
eCFR. 29 CFR 4041.29 – Post-Distribution Certification
15
Internal Revenue Service. Partial Termination of Plan