ESOP advisor in Concord, MO. Employee stock ownership plans (ESOPs) have become an increasingly popular retirement plan for employees in a variety of sectors in Concord, MO. They offer business owners an opportunity to move on from their company while considerably reducing taxes on the sale, and offer employees a qualified retirement plan that increases their investment in your company. However, designing, implementing, and maintaining an ESOP isn't something most Concord, MO business owners can do alone. Correct Capital's proficient and savvy ESOP advisors help businesses of all sizes, in Concord, MO and around the U.S., establish tailored retirement plans that benefit themselves, their employees, and their profit.
If you're in search of a trustworthy financial partner in Concord, MO who shares your goals of building your company and employees for long-term success, call Correct Capital at 877-930-4015, contact us online, or schedule an appointment with one of our financial advisors at this moment.
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Correct Capital Wealth Management's office is physically located in St. Louis, MO, but we serve clients throughout the United States in both personal financial planning and corporate retirement plans.
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What Is an Employee Stock Ownership Plan (ESOP)?
An ESOP is a tax-advantaged retirement plan where employees receive stock of the company that employs them, rather than savings funds or investments in other companies such as in a 401(k). ESOPs are 100% company funded, and often times shares offered to employees are not governing shares, meaning control of the company stays with ownership and other executives. They offer great incentives to employees while providing businesses with an enhanced value proposition in the hiring process, and allow business owners to set up a succession plan while retaining control. Upon reaching retirement, most employees sell the stock at marketplace value.
Perhaps even more importantly, by handing over part of your ownership to the ESOP, owners can defer capital gains taxes, allowing you to distribute that tax hit instead of having to pay taxes immediately. In many cases, ESOPs are a transition plan that keeps the most amount of money achievable with the owner.
Benefits of an Employee Stock Ownership Plan
- Sell a portion of your business (minimum 30%) with deferment of capital gains taxes (provided you reinvest into qualified replacement securities)
- Extra tax deductions through contributions made to employees
- If the business is eventually 100% owned as an S-Corp by the ESOP, it's exempt from federal income taxes
- Align the goals of employees and stockholders
- Provide a higher value proposition when hiring
- Improve employee motivation and productivity
- Enhance employee retention and loyalty
- Facilitate succession planning and business continuity
- Keep control while preparing or easing into retirement
- Raise personal liquidity of owners, but still keep control of the company
- Preserve your business' legacy and culture
What About KSOPs?
A KSOP is a similar type of plan that is a mix between an ESOP and a 401(k). Ownership shares are offered to employees as in an ESOP, employees can add their own money to buy additional shares through payroll deductions, or the company can match employee contributions with stock instead of cash.
Setting up a stock ownership plan doesn't have to exclude your employees from the risk tolerance that comes with diverse investments. In fact, introducing an ESOP or KSOP to a more traditional retirement plan allows you to receive the benefits of both. The experienced Concord, MO ESOP advisors and retirement consultants of Correct Capital can aid you find the best retirement plan for you, your business, and your employees.
How Our Concord, MO ESOP Advisors Can Help
Whether you're stepping from ownership of your company or are interested in an ESOP's other benefits, you'll need a knowledgeable Concord, MO ESOP advisory firm in your corner to reap the most benefits of your plan. When you work with Correct Capital, we:
- Reduce your tax liability as much as possible — When you sell your ownership shares to an ESOP, you can reinvest the proceeds in other securities to postpone capital gains taxes on the sales, allowing you to retain more of the sales proceeds for different purposes. To defer capital gains taxes, your ESOP advisor can help you carry out a Section 1042 exchange by selling at least 30% of your company to the ESOP and reinvesting that money in qualified replacement securities or QRP. Taxes would be owed until the taxpayer has a disposition of the QRP. An ESOP advisor can assure you receive the most tax benefit from your ESOP.
- Customize your ESOP and retirement plans — Along with your team, we'll create and execute an ESOP suited specifically to you and your company. We like to challenge ourselves and our clients to get imaginative with retirement plan offerings to enhance the benefits they provide. We'll examine your needs, evaluate different ESOP options, and propose a personalized ESOP that meets legal requirements and is aimed at maximizing benefits. If it makes sense, we may also advise combining an ESOP with a 401(k) or other retirement plans to further augment benefits, yet retain efficiencies.
- Conduct a ESOP feasibility study — When we first meet with our clients, we work to comprehend their needs and collaborate with them to discover the optimal tax-advantaged retirement plans for their business. For clients interested in an ESOP, part of that means conducting a feasibility analysis to determine if it's a feasible option for your company. We'll examine:
- Cash flow, debts, and overall financial health
- Ownership structure to understand the implications of introducing an ESOP
- Employee demographics to understand what they need from their retirement plan
- Tax implications for both your company and shareholders
- Company culture and employee engagement to see if an ESOP is likely to be well-received and supported
What if your business isn't a great fit for an ESOP? We'll collaborate with you to find a retirement or succession plan that works for you.
- Connect you with valuation firms and trustees — Implementing and maintaining an ESOP involves a lot of moving parts, including accountants, attorneys, and a trustee to purchase stock of the company on behalf of the ESOP. An experienced ESOP advisor with a strong network in Concord, MO can help you establish your ESOP team with dependable partners.
- Ensure compliance — IRS, Department of Labor, and ERISA all have strict regulations for the management of retirement plans. For instance, when individuals enrolled in an employee stock ownership plan at a closely held employer receive company stock in an ESOP distribution, they have the right to demand the employer to repurchase them at market value.
- ESOP sustainability assessments — In an ESOP, shares are granted to employees over time based on how long they've worked there. Most of the time, that means ownership of the company is passed to the ESOP in phases. Depending on how you structure your company and the plan, your ESOP may start with 30%, but could ultimately achieve 100% ownership. As the plan progresses and matures, so will its impact on your company. ESOP advisors can plan for these changes and respond to them in real time, facilitating your plan to stay viable, in accordance with regulations, and advantageous.
- Employee communication and education — Our ESOP advisors offer group sessions and personalized meetings with your employees so they can get the most from your retirement plan. With an ESOP advisor from Correct Capital, your employees won't just attain a share of your company, but they'll feel like they're gaining ownership of their financial health and future.
Why Choose Correct Capital as Your ESOP Advisor in Concord, MO
Correct Capital is an independent advisory firm that specializes in assisting business owners create retirement plans and succession plans for their enterprises. There are multiple factors we believe distinguish us from other financial advisory firms in Concord, MO, and across the nation:
- We're experienced in retirement plans and ESOPs. Correct Capital's clients currently operate these plans in a variety of industries, including for construction companies and contractors. As we work with both businesses and individuals and families when managing retirement plans, we're well-prepared to understand the demands of each and develop a plan that satisfies the requirements of both, as well as those of your stockholders.
- As independent fiduciary advisors, we are legally and ethically bound to do what's in the optimal interest of you, your employees, and your company. We strive to forge long-term relationships with our clients based on trust and the mutual goal of expanding your and your employees' monetary well-being.
Other services we offer in Concord, MO:
Call Correct Capital to Speak With an ESOP Advisor in Concord, MO Today
If you're interested in learning more about ESOPs or aspire to commence the process of setting one up for your Concord, MO business, contact a Correct Capital ESOP advisor now. Let us do what we do best so you can prioritize on what you value most: setting yourself, your business, and your employees up for prosperity. Get in touch with one of our Concord, MO ESOP advisors now at 877-930-4015 or contact us online.
