IRS Revises Model Salary Reduction SEP Plan Agreement

June 23, 2006 – The IRS has issued a June 2006-dated version of Form 5305A-SEP, Salary Reduction Simplified Employee Pension—Individual Retirement Accounts Contribution Agreement. Some employers who operate salary reduction SEP (SAR-SEP) plans use this model document. SAR-SEP plans may no longer be established, but employers who established SAR-SEP plans by December 31, 1996, may continue to operate their plans, and from time to time update their plan documents. The June 2006 version has been updated for several limitations, including the compensation cap, annual deferral limits, catch-up deferral limit, and the IRC Sec. 415 annual additions limit.

The form may be accessed as follows.
http://www.irs.gov/pub/irs-pdf/f5305ase.pdf