This is a very tricky problem. I've made the assumption that, if a proposal will lead a pirate to an equal share whether he agrees or not, he will disagree as to throw the other pirate overboard. Since they are pirates after all, arrrr.
Here's my solution:
Pirate 5 has to maximize his profit, but wants to stay alive most of all. The idea is that the other pirates will only agree with him if they get more than what they would get if they threw number 5 overboard, in which case there are 4 pirates left and they start again. This suggests we reason backwards.
Suppose 1 and 2 are left. Then 2 can make any suggestion whatsoever, 1 will disagree, throw 2 overboard and take all the loot (even if the proposal is that 1 gets all, since he IS a pirate

).
Suppose 3 pirates are left. 2 will agree with three anyway, since he knows he's off worse (death) if 3 doesn't get a majority. 1 will disagree ofcourse, so 3 can suggest to keep all the money himself.
Suppose 4 pirates are left. 3 will disagree with him, since he can get all the loot if 4 is gone, so 3 has to make sure 1 and 2 agree. Therefore he should give 1 coin to pirate 2 and 1 coin to pirate 1.
Now we can deduce pirate 5's decisicion. He should get 2 pirates to agree with him. Pirate 3 doesn't get anything if 5 is overboard, so he should get 1 coin. Then pirate 1 or 2 should get 2 coins. 5 can keep the rest himself.
Conclusion: The proposal will be:
Pirate 5: 997 coins (agree) Pirate 5: 997 coins (agree)
Pirate 4: 0 coins (disagree) Pirate 4: 0 coins (disagree)
Pirate 3: 2 coins (agree) or Pirate 3: 2 coins (agree)
Pirate 2: 0 coins (disagree) Pirate 2: 1 coins (agree)
Pirate 1: 1 coin (agree) Pirate 1: 0 coins (disagree)