ESOP advisor in Ellisville, MO. Employee stock ownership plans (ESOPs) have become an increasingly popular retirement plan for employees in a variety of sectors in Ellisville, MO. They offer business owners a chance to pass the torch from their company while considerably reducing taxes on the sale, and offer employees a tax-advantaged retirement plan that increases their productivity and motivation. However, designing, implementing, and maintaining an ESOP isn't something most Ellisville, MO business owners can do alone. Correct Capital's proficient and savvy ESOP advisors help businesses of all sizes, in Ellisville, MO and around the U.S., create tailored retirement plans that benefit themselves, their employees, and their bottom line.
If you're seeking a trustworthy financial partner in Ellisville, 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 today.
About Employee Stock Ownership Plans (ESOPs)
An ESOP is a qualified retirement plan where employees receive stock of the company they work for, rather than savings accounts 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 the C-suite. They offer superb incentives to employees while providing businesses with an improved value proposition to employees, and allow business owners to set up a succession plan while preserving control. Upon reaching retirement, most employees sell the stock at marketplace value.
Of special interest to business owners, 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 possible 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)
- Extra tax deductions through contributions made to employees
- If the business is one day 100% owned as an S-Corp by the ESOP, it's exempt from federal income taxes
- Align the goals of employees and stockholders
- Present a higher value proposition when hiring
- Improve employee motivation and productivity
- Boost employee retention and loyalty
- Simplify succession planning and business continuity
- Maintain control while arranging or easing into retirement
- Amplify 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 extended to employees as in an ESOP, employees can deposit their own money to purchase additional stock through payroll deductions, or the company can match employee contributions with shares rather than cash.
Setting up a stock ownership plan doesn't have to exclude your employees from more diverse investments. In fact, incorporating an ESOP or KSOP to a more traditional retirement plan allows you to attain the benefits of both. The experienced Ellisville, MO ESOP advisors and retirement consultants of Correct Capital can support you find the right plans for your business.
What Our Ellisville, MO ESOP Advisors Do for You
Whether you're moving on from ownership of your company or are interested in an ESOP's other benefits, you'll need an experienced Ellisville, MO ESOP advisory firm in your corner to get the most out of your plan. When you work with Correct Capital, we:
- Reduce your tax liability as much as possible — When you transfer 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 perform a Section 1042 exchange by selling at least 30% of your company to the ESOP and reinvesting the proceeds 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 obtain the most tax benefit from your ESOP.
- Customize your ESOP and retirement plans — Along with your team, we'll develop and implement an ESOP suited specifically to you and your company. We like to test ourselves and our clients to get creative with retirement plan offerings to maximize the advantages they provide. We'll assess your needs, analyze various ESOP options, and suggest a customized ESOP that meets legal requirements and is aimed at optimizing benefits. If we believe it's a good idea, we may also advise combining an ESOP with a 401(k) or other retirement plans to additionally increase benefits, yet retain efficiencies.
- Conduct a ESOP feasibility study — When we first meet with our clients, we work to comprehend their needs and work together with them to find the best qualified retirement plans for their company. For clients interested in an ESOP, part of that means performing a feasibility analysis to ascertain if it's a viable option for your company. We'll look at:
- Cash flow, debts, and overall financial health
- Ownership structure to understand the implications of 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 work 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 Ellisville, MO can help you set up your ESOP team with dependable partners.
- Ensure compliance — IRS, Department of Labor, and ERISA all have strict requirements for the oversight of retirement plans. For example, when ESOP participants at a closely held employer receive company stock in an ESOP distribution, they have the right to require the employer to repurchase them at fair market value.
- ESOP sustainability assessments — In an ESOP, shares are granted to employees over time based on seniority of service. Usually, that means ownership of the company is sold to the ESOP in stages. 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 develops and matures, so will its impact on your company. ESOP advisors can plan for these changes and adapt to them in real time, allowing your plan to stay feasible, compliant, and beneficial.
- Employee communication and education — Our ESOP advisors offer group sessions and personalized meetings with your employees so they can maximize the benefits from your ESOP. 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 achieving ownership of their economic well-being and eventual retirement.
Why Choose Correct Capital as Your ESOP Advisor in Ellisville, MO
Correct Capital is an independent advisory firm that specializes in helping business owners establish retirement plans and succession plans for their enterprises. There are numerous factors we point to that distinguish us from other investment advisory agencies in Ellisville, MO, and all over the United States:
- We know retirement plans and ESOPs. Correct Capital's clients currently operate these plans in a wide range of sectors, including for construction companies and contractors. As we work with both businesses and individuals and families to aid in setting up retirement plans, we're ideally suited to understand the requirements of each and establish a plan that fulfills the needs of both, as well as those of your stockholders.
- As independent fiduciary advisors, we are lawfully and ethically bound to do what's in the utmost benefit of you, your employees, and your company. We strive to establish long-term relationships with our clients based on trust and the common goal of expanding your and your employees' monetary well-being.
Other services we offer in Ellisville, MO:
Call Correct Capital to Speak With an ESOP Advisor in Ellisville, MO Today
If you're interested in learning more about ESOPs or desire to initiate the process of setting one up for your Ellisville, MO business, get in touch with a Correct Capital ESOP advisor at this moment. Let us do what we do best so you can concentrate on what you value most: setting yourself, your business, and your employees up for success. Get in touch with one of our Ellisville, MO ESOP advisors immediately at 877-930-4015 or contact us online.
