ESOP advisor in Glendale, MO. Employee stock ownership plans (ESOPs) are becoming a more and more common retirement benefit for employees in various industries in Glendale, MO. They offer business owners an opportunity to transition from their company while considerably reducing taxes on the sale, and offer employees a qualified retirement plan that builds their productivity and motivation. However, designing, implementing, and maintaining an ESOP isn't something most Glendale, MO business owners can do by themselves. Correct Capital's knowledgeable and savvy ESOP advisors help businesses of all sizes, in Glendale, MO and around the nation, create tailored retirement plans that benefit themselves, their employees, and their profit.
If you're looking for an experienced financial partner in Glendale, MO who shares your goals of building your company and employees for prolonged success, call Correct Capital at 877-930-4015, contact us online, or schedule a consultation with one of our financial advisors now.
What Is an Employee Stock Ownership Plan (ESOP)?
An ESOP is a tax-advantaged retirement plan where employees receive shares of the company they work for, 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 the C-suite. They offer superb 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 preserving control. When they retire, most employees sell the stock at market 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 spread out that tax hit instead of needing to pay taxes at once. In many cases, ESOPs are a succession plan that keeps the most amount of money attainable 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 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
- Enhance employee motivation and productivity
- Boost employee retention and loyalty
- Enable succession planning and business continuity
- Keep control while organizing or easing into retirement
- Increase personal liquidity of owners, but still retain control of the company
- Preserve your business' legacy and culture
What About KSOPs?
A KSOP is a qualified plan that is a mix between an ESOP and a 401(k). Ownership shares are offered to employees as in an ESOP, employees can put in their own money to buy additional stock 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 obtain the benefits of both. The experienced Glendale, MO ESOP advisors and retirement consultants of Correct Capital can aid you find the right plans for your business.
What Our Glendale, MO ESOP Advisors Do for You
Whether you're motivated by a succession plan, employee incentives, or any other of ESOPs' benefits, you'll need a knowledgeable Glendale, MO ESOP advisory firm by your side 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 sell your ownership shares to an ESOP, you can reinvest the proceeds in other securities to postpone capital gains taxes on the sales, permitting you to keep more of the profit. To defer 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 the proceeds in qualified replacement securities or QRP. Taxes would be payable until the taxpayer has a sale of the QRP. An ESOP advisor can assure you get the most tax benefit from your ESOP.
- Personalize your ESOP and retirement plans — Along with your team, we'll create and implement an ESOP that works best for you and your one-of-a-kind company. We like to test ourselves and our clients to get imaginative with retirement plan offerings to maximize the advantages they provide. We'll evaluate your needs, assess different ESOP options, and propose a tailored ESOP that meets legal requirements and is aimed at optimizing benefits. If we believe it's a good idea, we may also recommend combining an ESOP with a 401(k) or alternative retirement plans to further increase benefits, yet retain efficiencies.
- Conduct a ESOP feasibility study — When we first meet with our clients, we work to understand their needs and collaborate with them to identify the best tax-advantaged retirement plans for their company. For clients looking at an ESOP, part of that means carrying out a feasibility analysis to establish if it's a viable option for your company. We'll analyze:
- Cash flow, debts, and overall financial health
- Ownership structure to understand how it'll be affected by 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 assess 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 partner 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 acquire stock of the company on behalf of the ESOP. An experienced ESOP advisor with a strong network in Glendale, MO can help you establish your ESOP team with dependable partners.
- Ensure compliance — IRS, Department of Labor, and ERISA all have strict guidelines for the management of employee stock ownership plans. For instance, when employees participating in an ESOP at a closely held employer receive company stock in an ESOP distribution, they have the right 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 seniority of service. Usually, 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 implications for your company. ESOP advisors can plan for these changes and adapt to them in real time, facilitating your plan to stay feasible, in accordance with regulations, and advantageous.
- Employee communication and education — Our ESOP advisors offer group meetings and individual consultations with your employees so they can optimize the advantages from your retirement plan. With an ESOP advisor from Correct Capital, your employees won't just get partial ownership of your company, but they'll feel like they're gaining ownership of their financial health and eventual retirement.
Why Choose Correct Capital as Your ESOP Advisor in Glendale, MO
Correct Capital is an independent advisory firm that specializes in helping business owners establish retirement plans and succession plans for their businesses. There are multiple factors we believe distinguish us from other financial consulting companies in Glendale, 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 wide range of sectors, 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 develop a plan that meets the needs of both, as well as those of your stockholders.
- Our award-winning Glendale, MO financial advisory team is composed of a diverse 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 80 years of combined experience, we pool our collective talents and insights to optimally assist each client individually.
- As independent fiduciary advisors, we are legally and morally bound to do what's in the utmost benefit of you, your employees, and your company. We strive to form long-term relationships with our clients founded on trust and the shared goal of expanding your and your employees' wealth.
Other services we offer in Glendale, 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 Glendale, MO Today
If you're interested in learning more about ESOPs or wish to start the process of setting one up for your Glendale, MO business, reach out to 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 achievement. Contact with one of our Glendale, MO ESOP advisors immediately at 877-930-4015 or contact us online.
