ESOP advisor in Des Peres, MO. Employee stock ownership plans (ESOPs) are becoming a more and more well-liked retirement benefit for employees in a variety of sectors in Des Peres, MO. They offer business owners an opportunity to move on from their company while greatly reducing taxes on the sale, and offer employees a qualified retirement plan that increases their productivity and motivation. However, designing, implementing, and maintaining an ESOP isn't something most Des Peres, MO business owners can do by themselves. Correct Capital's proficient and savvy ESOP advisors help businesses of all sizes, in Des Peres, MO and around the United States, establish tailored retirement plans that benefit themselves, their employees, and their bottom line.
If you're in search of an experienced financial partner in Des Peres, MO who shares your goals of establishing your company and employees for sustained success, call Correct Capital at 877-930-4015, contact us online, or schedule a consultation with one of our financial advisors right away.
About Employee Stock Ownership Plans (ESOPs)
An ESOP is a qualified retirement plan where employees receive shares of the company that employs them, rather than savings or investments in other companies as in a typical retirement plan. ESOPs are 100% company funded, and often times shares offered to employees are not governing shares, meaning control of the company stays with the C-suite. They offer excellent 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. When they retire, most employees sell the stock at market value.
Perhaps most importantly, by transferring part of your ownership to the ESOP, owners can defer capital gains taxes, allowing you to disperse that tax hit instead of having to pay taxes promptly. In many cases, ESOPs are a transition plan that keeps the most amount of money feasible in your pocket.
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)
- Further tax deductions through contributions made to employees
- If the business is one day 100% owned as an S-Corp by the ESOP, it's free from federal income taxes
- Align the goals of employees and stockholders
- Present a higher value proposition when hiring
- Boost employee motivation and productivity
- Boost employee retention and loyalty
- Simplify succession planning and business continuity
- Retain control while planning or easing into retirement
- Amplify personal liquidity of owners, but still hold on to control of the company
- Carry on your business' legacy and culture
What About KSOPs?
A KSOP is a similar type of plan that is a combination of 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 rather than 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, adding an ESOP or KSOP to a more traditional retirement plan allows you to obtain the benefits of both. The experienced Des Peres, MO ESOP advisors and retirement consultants of Correct Capital can support you find the best retirement plan for you, your company, and your employees.
How Our Des Peres, MO ESOP Advisors Can Help
Whether you're moving on from ownership of your company or are interested in an ESOP's other benefits, you'll need a knowledgeable Des Peres, MO ESOP advisory firm by your side to reap the most benefits of your plan. When you work with Correct Capital, we:
- Lower your tax liability as much as possible — When you sell your ownership shares to an ESOP, you have the option to reinvest the proceeds in different securities to defer capital gains taxes on the sales, allowing you to keep more of the sales proceeds for different purposes. To postpone capital gains taxes, your ESOP advisor can help you execute 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 payable until the taxpayer has a disposition of the QRP. An ESOP advisor can assure you obtain the most tax benefit from your ESOP.
- Personalize your ESOP and retirement plans — Along with your team, we'll design and implement an ESOP suited specifically to you and your company. We like to push ourselves and our clients to get innovative with retirement plan offerings to enhance the advantages they offer. We'll evaluate your needs, evaluate different ESOP options, and recommend a tailored ESOP that meets legal requirements and is aimed at optimizing benefits. If we believe it'll work, we may also advise combining an ESOP with a 401(k) or alternative retirement plans to further increase benefits, without sacrificing efficiencies.
- Conduct a ESOP feasibility study — When we first meet with our clients, we work to grasp their needs and collaborate with them to find the optimal tax-advantaged retirement plans for their company. For clients looking at an ESOP, part of that means conducting a feasibility analysis to establish if it's a feasible option for your company. We'll look at:
- Cash flow, debts, and overall financial health
- Ownership structure to understand how it'll be affected by introducing an ESOP
- Employee demographics to understand how they're best served
- Tax implications for both your company and shareholders
- Company culture and employee engagement to determine 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 Des Peres, MO can help you set up your ESOP team with dependable partners.
- Ensure compliance — IRS, Department of Labor, and ERISA all have strict guidelines for the management of ESOPs. For instance, when ESOP participants at a closely held employer receive company stock in an ESOP distribution, they have the option to demand the employer to buy back them at fair 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 sold to the ESOP in increments. 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 feasible, compliant, and advantageous.
- Employee communication and education — Our ESOP advisors offer group meetings and one-on-one meetings with your employees so they can maximize the benefits from your retirement plan. With an ESOP advisor from Correct Capital, your employees won't just attain a portion of your company, but they'll feel like they're obtaining ownership of their financial health and eventual retirement.
Why Choose Correct Capital as Your ESOP Advisor in Des Peres, MO
Correct Capital is an independent advisory firm that specializes in helping business owners create retirement plans and succession plans for their enterprises. There are multiple factors we point to that distinguish us from other financial consulting companies in Des Peres, MO, and across the U.S.:
- A member of the National Association of Plan Advisors (NAPA), Correct Capital was recently named one of their Top Defined Contribution (DC) Teams with Assets under Advisement of at least $100 million. Correct Capital is the only advisory firm in Missouri to achieve this distinction.
- 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 ideally suited to understand the needs of each and create a plan that meets the necessities of both, as well as those of your stockholders.
- Our award-winning Des Peres, MO financial advisory team is composed of a wide range of financial expertise, including an Accredited Investment Fiduciary®, multiple CERTIFIED FINANCIAL PLANNER™ professionals, a certified public accountant, and a six-time Barron's Top 1200 Advisor. With over eight decades of combined experience, we pool our collective talents and insights to effectively cater to each client uniquely.
- As independent fiduciary advisors, we are lawfully and morally bound to do what's in the best interest of you, your employees, and your company. We strive to forge long-term relationships with our clients grounded in trust and the mutual goal of increasing your and your employees' monetary well-being.
Other services we offer in Des Peres, MO:
- Succession Planning
- Fiduciary Financial Advisor
- Company 401(k) Plans
- Self-Employed Retirement Plans
- 401(k) For Small Business
- Small Business Retirement Plans
- Tax Planning
Call Correct Capital to Speak With an ESOP Advisor in Des Peres, MO Today
If you're interested in learning more about ESOPs or aspire to start the process of setting one up for your Des Peres, MO business, reach out to a Correct Capital ESOP advisor at this moment. Let us do what we do best so you can prioritize on what you care about most: setting yourself, your business, and your employees up for success. Reach out with one of our Des Peres, MO ESOP advisors immediately at 877-930-4015 or contact us online.
