ESOP advisor in Imperial, MO. Employee stock ownership plans (ESOPs) are becoming a more and more well-liked retirement benefit for employees in a variety of sectors in Imperial, MO. They offer business owners an opportunity to pass the torch from their company while significantly reducing taxes on the sale, and offer employees a tax-advantaged retirement plan that builds their investment in your company. However, designing, implementing, and maintaining an ESOP isn't something most Imperial, MO business owners can do without professional help. Correct Capital's seasoned and savvy ESOP advisors help businesses of all sizes, in Imperial, MO and around the country, create tailored retirement plans that benefit themselves, their employees, and their bottom line.
If you're in search of an experienced financial partner in Imperial, MO who shares your goals of setting up 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 today.
What Is an Employee Stock Ownership Plan (ESOP)?
An ESOP is a qualified 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 voting 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 to employees, and allow business owners to set up a succession plan while preserving control. Upon reaching retirement, most employees sell the stock at market value.
Of special interest to business owners, by selling part of your ownership to the ESOP, owners can defer capital gains taxes, allowing you to allocate the tax consequences of the sale instead of being required to pay taxes promptly. In many cases, ESOPs are a succession plan that keeps the most amount of money possible 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
- Offer a higher value proposition when hiring
- Enhance employee motivation and productivity
- Boost employee retention and loyalty
- Ease succession planning and business continuity
- Retain control while organizing or easing into retirement
- Amplify personal liquidity of owners, but still hold on to 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 extended to employees as in an ESOP, employees can contribute 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 the risk tolerance that comes with diverse investments. In fact, incorporating an ESOP or KSOP to a more traditional retirement plan allows you to receive the benefits of both. The experienced Imperial, MO ESOP advisors and retirement consultants of Correct Capital can aid you find the right plans for your business.
What Our Imperial, MO ESOP Advisors Do for You
Whether you're stepping from ownership of your company or are interested in an ESOP's other benefits, you'll need a knowledgeable Imperial, MO ESOP advisory firm to partner with 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 transfer your ownership shares to an ESOP, you can reinvest the proceeds in different 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 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 payable until the taxpayer has a disposition of the QRP. An ESOP advisor can ensure you obtain the most tax benefit from your ESOP.
- Personalize your ESOP and retirement plans — Along with your team, we'll develop and set up 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 examine your needs, evaluate various ESOP options, and recommend a tailored ESOP that meets legal requirements and is aimed at maximizing benefits. If we believe it's a good idea, we may also suggest 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 work together with them to discover the best tax-advantaged retirement plans for their business. For clients looking at 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 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, lawyers, and a trustee to buy stock of the company on behalf of the ESOP. An experienced ESOP advisor with a strong network in Imperial, MO can help you establish your ESOP team with reliable partners.
- Ensure compliance — IRS, Department of Labor, and ERISA all have strict guidelines for the administration of employee stock ownership 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 option 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 duration of service. Most of the time, that means ownership of the company is passed 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 progresses and matures, so will its implications for your company. ESOP advisors can plan for these changes and react to them in real time, allowing your plan to stay viable, in accordance with regulations, and advantageous.
- Employee communication and education — Our ESOP advisors offer group sessions and individual consultations with your employees so they can get the most from your employee stock ownership 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 obtaining ownership of their financial stability and future.
Why Choose Correct Capital as Your ESOP Advisor in Imperial, 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 point to that set us apart from other financial advisory firms in Imperial, MO, and throughout the United States:
- 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 know retirement plans and ESOPs. Correct Capital's clients currently operate these plans in a wide range 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 requirements of each and develop a plan that meets the requirements of both, as well as those of your stockholders.
- Our award-winning Imperial, MO financial advisory team is made up 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 80 years of combined experience, we pool our collective talents and insights to effectively cater to each client individually.
- As independent fiduciary advisors, we are legally and morally bound to do what's in the optimal interest of you, your employees, and your company. We aim to form long-term relationships with our clients grounded in trust and the shared goal of expanding your and your employees' monetary well-being.
Other services we offer in Imperial, 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 Imperial, MO Today
If you're interested in learning more about ESOPs or wish to commence the process of setting one up for your Imperial, MO business, reach out to a Correct Capital ESOP advisor today. Let us do what we do best so you can prioritize on what you value most: positioning yourself, your business, and your employees up for success. Reach out with one of our Imperial, MO ESOP advisors now at 877-930-4015 or contact us online.
