Table of Contents
- General Instructions
- Specific Instructions
- Part I—Taxes
- Schedule A (Section 4972)
- Schedule B (Section 4973(a)(3))
- Schedule C (Section 4975)
- Schedule C(continued)
- Schedule D (Section 4971(a) and (b))
- Schedule E (Section 4971(f))
- Schedule F (Section 4971(g))
- Schedule G (Section 4977)
- Schedule H (Section 4979)
- Schedule I (Section 4980)
- Schedule J (Section 4980F)
- Privacy Act and Paperwork Reduction Act Notice.
Section 4971(g), Multiemployer Plans in Endangered or Critical Status. For years beginning after 2007, the Pension Protection Act of 2006 states that a failure to comply with a funding improvement or rehabilitation plan, a failure to meet requirements for plans in endangered or critical status, or a failure to adopt a rehabilitation plan may be subject to an excise tax.
File Form 5330 to report the tax on:
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A prohibited tax shelter transaction (section 4965(a)(2)).
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A minimum funding deficiency (section 4971(a) and (b)).
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A failure to pay liquidity shortfall (section 4971(f)).
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A failure to comply with a funding improvement or rehabilitation plan (section 4971(g)(2)).
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A failure to meet requirements for plans in endangered or critical status (section 4971(g)(3)).
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A failure to adopt rehabilitation plan (section 4971(g)(4)).
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Nondeductible contributions to qualified plans (section 4972).
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Excess contributions to a section 403(b)(7)(A) custodial account (section 4973(a)(3)).
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A prohibited transaction (section 4975).
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A disqualified benefit provided by funded welfare plans (section 4976).
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Excess fringe benefits (section 4977).
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Certain ESOP dispositions (section 4978).
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Excess contributions to plans with cash or deferred arrangements (section 4979).
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Certain prohibited allocations of qualified securities by an ESOP (section 4979A).
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Reversions of qualified plan assets to employers (section 4980).
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A failure of an applicable plan reducing future benefit accruals to satisfy notice requirements (section 4980F).
A Form 5330 must be filed by:
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Any plan entity manager of a tax-exempt entity who approves the entity as a party to, or otherwise causes the entity to be a party to, a prohibited tax shelter transaction during the tax year and knows or has reason to know the transaction is a prohibited tax shelter transaction, see section 4965(a)(2).
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Any employer who is liable for the tax under section 4971 for failure to meet the minimum funding standards under section 412 (liability for tax in the case of an employer who is a party to a collective bargaining agreement, see section 413(b)(6)).
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Any employer who is liable for the tax under section 4971(f) for a failure to meet the liquidity requirement of section 412(m)(5).
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Any employer with respect to a multiemployer plan who is liable for the tax under section 4971(g)(2) for failure to comply with a funding improvement or rehabilitation plan under section 432.
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Any employer with respect to a multiemployer plan who is liable for the tax under section 4971(g)(3) for failure to meet the requirements for plans in endangered or critical status under section 432.
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Any plan sponsor with respect to a multiemployer plan who is liable for the tax under section 4971(g)(4) for failure to adopt a rehabilitation plan within the time required under section 432.
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Any employer who is liable for the tax under section 4972 for nondeduct-
ible contributions to qualified plans. -
Any individual who is liable for the tax under section 4973(a)(3) because an excess contribution to a section 403(b)(7)(A) custodial account was made for them and that excess has not been eliminated as specified in sections 4973(c)(2)(A) and (B).
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Any disqualified person who is liable for the tax under section 4975 for participating in a prohibited transaction (other than a fiduciary acting only as such), or an individual (or his or her beneficiary) who engages in a prohibited transaction with respect to his or her individual retirement account (unless section 408(e)(2)(A) or section 408(e)(4) applies) for each tax year or part of a tax year in the taxable period applicable to such prohibited transaction.
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Any employer who is liable for the tax under section 4976 for maintaining a funded welfare benefit plan that provides a disqualified benefit during any tax year.
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Any employer who pays excess fringe benefits and has elected to be taxed under section 4977 on such payments.
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Any employer or worker-owned cooperative (as defined in section 1042(c)(2)) that maintains an ESOP that disposes of the qualified securities (as defined in section 1042(c)(1)) within the specified 3-year period, under section 4978.
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Any employer who is liable for the tax under section 4979 on excess contributions to plans with a cash or deferred arrangement, etc.
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Any employer or worker-owned cooperative that made the written statement described in section 664(g)(1)(E) or 1042(b)(3)(B) and made an allocation prohibited under section 409(n) of qualified securities of an ESOP taxable under section 4979A or any employer or worker-owned cooperative who made an allocation of S corporation stock of an ESOP prohibited under section 409(p) taxable under section 4979A.
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Any employer who receives an employer reversion from a deferred compensation plan that is taxable under section 4980.
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Any employer or multiemployer plan liable for the tax under section 4980F for failure to give notice of a significant reduction in the rate of future benefit accrual.
A Form 5330 and tax payment is required for:
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Each year you fail to meet the minimum funding standards under section 412 or contribute an excess amount to your section 403(b)(7)(A) custodial account.
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Each year any of the items in 1, 3, 5, 6, 7, or 9 through 14, or 16 under Who Must File, beginning on page 1, apply.
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Each failure of the employer to make the required contribution as required by a funding improvement or rehabilitation plan under section 432 with respect to a multiemployer plan.
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A reversion of plan assets from a qualified plan taxable under section 4980.
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Each year (or part of a year) in the taxable period applicable to a prohibited transaction, under section 4975. See the instructions for Schedule C, line 2, columns (d) and (e), for a definition of taxable period.
File one Form 5330 to report excise taxes with the same filing due date. One Form 5330 may be filed to report one or more of these taxes. However, if the taxes are from separate plans, file separate forms for each plan.
Generally, the filing of a Form 5330 starts the statute of limitations running only with respect to the particular excise tax(es) reported on that Form 5330. However, statutes of limitations with respect to the prohibited transaction excise tax(es) are based on the filing of the applicable Form 5500. Use Table 1 to determine the due date of Form 5330.
Caution:
Form 5558 does not extend the time to pay your taxes. See the instructions for Form 5558.
Table 1. Excise Tax Due Dates
| If the taxes due are under section . . . | Then, except for section 4965, file Form 5330 by the last day of the . . . and for section 4965 by the . . . |
|---|---|
| 4965 | 15th day of the 5th month following the close of the entity manager's tax year during which the tax-exempt entity becomes a party to the transaction. |
| 4971 | 7th month after the end of the employer's tax year or 8½ months after the last day of the plan year that ends with or within the filer's tax year. |
| 4971(f) | 7th month after the end of the employer's tax year or 8½ months after the last day of the plan year that ends with or within the filer's tax year. |
| 4971(g)(2) | 7th month after the end of the employer's tax year or 8½ months after the last day of the plan year that ends with or within the filer's tax year. |
| 4971(g)(3) | 7th month after the end of the employer's tax year or 8½ months after the last day of the plan year that ends with or within the filer's tax year. |
| 4971(g)(4) | 7th month after the end of the employer's tax year or 8½ months after the last day of the plan year that ends with or within the filer's tax year. |
| 4972 | 7th month after the end of the tax year of the employer or other person who must file this return. |
| 4973(a)(3) | 7th month after the end of the tax year of the employer or other person who must file this return. |
| 4975 | 7th month after the end of the tax year of the employer or other person who must file this return. |
| 4976 | 7th month after the end of the tax year of the employer or other person who must file this return. |
| 4977 | 7th month after the end of the calendar year in which the excess fringe benefits were paid to your employees. |
| 4978 | 7th month after the end of the tax year of the employer or other person who must file this return. |
| 4979 | 15th month after the close of the plan year to which the excess contributions or excess aggregate contributions relate. |
| 4979A | 7th month after the end of the tax year of the employer or other person who must file this return. |
| 4980 | month following the month in which the reversion occurred. |
| 4980F | month following the month in which the failure occurred. |
| If the filing due date falls on a Saturday, Sunday, or legal holiday, the return may be filed on the next business day. | |

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File an amended Form 5330 for any of the following:
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To claim a refund of overpaid taxes reportable on Form 5330;
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For a credit for overpaid taxes; or
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To report additional taxes due within the same tax year of the filer if those taxes have the same due date as those previously reported. Check the box in item H on page 1 of the return and report the correct amount of taxes in Schedule A through K, as appropriate, and on lines 1 through 16 of Part I. See instructions for Part II, lines 17 through 19.
If you file an amended return to claim a refund or credit, the claim must state in detail the reasons for claiming the refund. In order for the IRS to promptly consider your claim, you must explain why you are filing the claim and provide the appropriate supporting evidence. See Regulations section 301.6402-2 for more details.
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The employer, for an employee benefit plan that a single employer established or maintains;
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The employee organization in the case of a plan of an employee organization;
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The association, committee, joint board of trustees, or other similar group of representatives of the parties who establish or maintain the plan, if the plan is established or maintained jointly by one or more employers and one or more employee organizations, or by two or more employers.
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Sign the return by hand, in the space provided for the preparer's signature (signature stamps and labels are not acceptable).
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Give a copy of the return to the filer.
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Any post-retirement medical benefit or life insurance benefit provided for a key employee unless the benefit is provided from a separate account established for the key employee under section 419A(d);
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Any post-retirement medical benefit or life insurance benefit unless the plan meets the nondiscrimination requirements of section 505(b) for those benefits; or
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Any portion of the fund that reverts to the benefit of the employer.
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The total number of shares held by that plan or cooperative after the disposition is less than the total number of employer securities held immediately after the sale, or
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Except to the extent provided in regulations, the value of qualified securities held by the plan or cooperative after the disposition is less than 30% of the total value of all employer securities as of the disposition (60% of the total value of all employer securities in the case of any qualified employer securities acquired in a qualified gratuitous transfer to which section 664(g) applied).
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The death of the employee;
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The retirement of the employee after the employee has reached age 59½;
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The disability of the employee (within the meaning of section 72(m)(7)); or
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The separation of the employee from service for any period that results in a 1-year break in service (as defined in section 411(a)(6)(A)).

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A prohibited allocation of qualified securities by any ESOP or eligible worker-owned cooperative.
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An allocation described in section 664(g)(5)(A). Section 664(g)(5)(A) prohibits any portion of the assets of the ESOP attributable to securities acquired by the plan in a qualified gratuitous transfer to be allocated to the account of:
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Any person related to the decedent (within the meaning of section 267(b)) or a member of the decedent's family (within the meaning of section 2032A(e)(2)), or
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Any person who, at the time of the allocation, or at any time during the 1-year period ending on the date of the acquisition of qualified employer securities by the plan, is a 5% shareholder of the employer maintaining the plan.
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The accrual or allocation of S corporation shares in an ESOP during a nonallocation year constituting a prohibited allocation under section 409(p).
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Any synthetic equity owned by a disqualified person in any nonallocation year.
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10 years after the date of sale; or
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The date on which the final payment is made if acquisition indebtedness was incurred at the time of sale.

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The ESOP was established after March 14, 2001, or
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The ESOP was established on or before March 14, 2001, and the employer maintaining the plan was not an S corporation.
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The value of any synthetic equity owned by a disqualified person in any nonallocation year. Synthetic equity means any stock option, warrant, restricted stock, deferred issuance stock right, or similar interest or right that gives the holder the right to acquire or receive stock of the S corporation in the future. Synthetic equity may also include a stock appreciation right, phantom stock unit, or similar right to a future cash payment based on the value of the stock or appreciation; and nonqualified deferred compensation as described in Regulations section 1.409(p)-1(f)(2)(iv). The value of a synthetic equity is the value of the shares on which the synthetic equity is based or the present value of the nonqualified deferred compensation.
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The value of any S corporation shares in an ESOP accruing during a nonallocation year or allocated directly or indirectly under the ESOP or any other plan of the employer qualified under section 401(a) for the benefit of a disqualified person. For additional information see Regulations section 1.409(p)-1(b)(2).
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The total value of all the deemed-owned shares of all disqualified persons.
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50% of the number of outstanding shares of the S corporation (including deemed-owned ESOP shares), or
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50% of the aggregate number of outstanding shares of stock (including deemed-owned ESOP shares) and synthetic equity in the S corporation.
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Spouse.
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Ancestor or lineal descendant of the individual or the individual's spouse.
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A brother or sister of the individual or of the individual's spouse and any lineal descendant of the brother or sister.
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The total number of shares owned by the person and the members of the person's family (as defined in section 409(p)(4)(D)) is at least 20% of the deemed-owned shares (as defined in section 409(p)(4)(C)) in the S corporation, or
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The person owns at least 10% of the deemed-owned shares (as defined in section 409(p)(4)(C)) in the S corporation.


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Qualified pension, profit-sharing, and stock bonus plans described in section 401(a);
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Annuity plans described in section 403(a);
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Annuity contracts described in section 403(b);
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Qualified tuition programs described in section 529;
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Retirement plans described in section 457(b) maintained by a governmental employer;
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Individual retirement accounts within the meaning of section 408(a);
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Individual retirement annuities within the meaning of section 408(b);
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Archer medical savings accounts (MSAs) within the meaning of section 220(d);
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Coverdell education savings accounts described in section 530; and
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Health savings accounts within the meaning of section 223(d).
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A Listed transaction within the meaning of section 6707A(c)(2). Listed transactions are reportable transactions that are the same as, or substantially similar to, any transactions that have been specifically identified by the Secretary as a tax avoidance transaction for purposes of section 6011.
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A prohibited reportable transaction is:
a. Any confidential transaction within the meaning of Regulations section 1.6011-4(b)(3); or b. Any transaction with contractual protection within the meaning of Regulations section 1.6011-4(b)(4).

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The excess (if any) of the employer's contribution for the tax year less the amount allowable as a deduction under section 404 for that year, and
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The total amount of the employer's contributions for each preceding tax year that was not allowable as a deduction under section 404 for such preceding year, reduced by the sum of
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The portion of such amount that was available for return under the applicable qualification rules and was actually returned to the employer prior to the close of the current tax year and
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The portion of such amount that became deductible for a preceding tax year or for the current tax year.
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Employer contributions to one or more defined contribution plans which are nondeductible solely because of section 404(a)(7) that do not exceed the matching contributions described in section 401(m)(4)(A),
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Contributions to a SIMPLE 401(k) or a SIMPLE IRA that are considered nondeductible because they are not made in connection with the employer's trade or business. However, this provision pertaining to SIMPLEs does not apply to contributions made on behalf of the employer or the employer's family, or
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Contributions not in excess of 6% of the compensation (as defined in section 404(a) and adjusted in section 404(a)(12)) paid or accrued during the tax year to the beneficiaries under the plans.
Section 4973(c) imposes a 6% excise tax on the excess contributions to 403(b)(7)(A) custodial accounts at the close of the tax year. The tax is paid by the individual account holder.

The limit on annual additions under section 415(c)(1)(A) is subject to cost-of-living adjustments as described in section 415(d). The dollar limit for a calendar year as adjusted annually is published during the fourth quarter of the prior calendar year in the Internal Revenue Bulletin.
Section 4975 imposes an excise tax on a disqualified person that engages in a prohibited transaction with the plan.
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A trust described in section 401(a) that forms part of a plan.
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A plan described in section 403(a), and that trust or plan is exempt from tax under section 501(a).
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An individual retirement account described in section 408(a).
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An individual retirement annuity described in section 408(b).
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An Archer MSA described in section 220(d).
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A Coverdell education savings account described in section 530.
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A Health Savings Account described in section 223(d).
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A trust described in section 501(c)(22).

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A fiduciary.
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A person providing services to the plan.
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An employer, any of whose employees are covered by the plan.
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An employee organization, any of whose members are covered by the plan.
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Any direct or indirect owner of 50% or more of:
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The combined voting power of all classes of stock entitled to vote, or the total value of shares of all classes of stock of a corporation,
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The capital interest or the profits interest of a partnership,
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The beneficial interest of a trust or unincorporated enterprise in a, b, or c, which is an employer or an employee organization described in 3 or 4 above. A limited liability company should be treated as a corporation, or a partnership, depending on how the organization is treated for federal tax purposes.
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A member of the family of any individual described in 1, 2, 3, or 5. A member of a family is the spouse, ancestor, lineal descendant, and any spouse of a lineal descendant.
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A corporation, partnership, or trust or estate of which (or in which) any direct or indirect owner holds 50% or more of the interest described in 5a, 5b, or 5c of such entity. For purposes of 7, the beneficial interest of the trust or estate is owned directly or indirectly, or held by persons described in 1 through 5.
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An officer, director (or an individual having powers or responsibilities similar to those of officers or directors), a 10% or more shareholder or highly compensated employee (earning 10% or more of the yearly wages of an employer) of a person described in 3, 4, 5, or 7.
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A 10% or more (in capital or profits) partner or joint venturer of a person described in 3, 4, 5, or 7.
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Any disqualified person, as described in 1 through 9 above, who is a disqualified person with respect to any plan to which a section 501(c)(22) trust applies, that is permitted to make payments under section 4223 of the Employee Retirement Income Security Act (ERISA).
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Sale or exchange, or leasing of any property between a plan and a disqualified person; or a transfer of real or personal property by a disqualified person to a plan where the property is subject to a mortgage or similar lien placed on the property by the disqualified person within 10 years prior to the transfer, or the property transferred is subject to a mortgage or similar lien which the plan assumes.
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Lending of money or other extension of credit between a plan and a disqualified person.
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Furnishing of goods, services, or facilities between a plan and a disqualified person.
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Transfer to, or use by or for the benefit of, a disqualified person of income or assets of a plan.
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Act by a disqualified person who is a fiduciary whereby he or she deals with the income or assets of a plan in his or her own interest or account.
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Receipt of any consideration for his or her own personal account by any disqualified person who is a fiduciary from any party dealing with the plan connected with a transaction involving the income or assets of the plan.







