ESOP advisor in Lemay, MO. Employee stock ownership plans (ESOPs) are becoming a more and more common retirement plan for employees in a variety of sectors in Lemay, MO. They offer business owners a chance to exit their company while significantly 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 Lemay, MO business owners can do without professional help. Correct Capital's proficient and savvy ESOP advisors help businesses of all sizes, in Lemay, MO and around the U.S., design tailored retirement plans that benefit themselves, their employees, and their revenue.
If you're seeking an experienced financial partner in Lemay, 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 an appointment with one of our financial advisors right away.
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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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About Employee Stock Ownership Plans (ESOPs)
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 as in a typical retirement plan. ESOPs are fully funded by the employer, and often times shares offered to employees are not controlling 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 retaining control. When they retire, most employees sell the stock at market value 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 needing to pay taxes immediately. In many cases, ESOPs are a transition 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)
- Further 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
- Present a higher value proposition when hiring
- Improve employee motivation and productivity
- Improve employee retention and loyalty
- Ease succession planning and business continuity
- Maintain control while organizing or easing into retirement
- Increase personal liquidity of owners, but still keep 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 mix between an ESOP and a 401(k). Ownership shares are offered to employees as in an ESOP, employees can contribute their own money to obtain 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 Lemay, MO ESOP advisors and retirement consultants of Correct Capital can help you find the best retirement plan for you, your business, and your employees.
How Our Lemay, MO ESOP Advisors Can Help
Whether you're motivated by a succession plan, employee incentives, or any other of ESOPs' benefits, you'll need an experienced Lemay, MO ESOP advisory firm in your corner to get the most out of your plan. When you work with Correct Capital, we:
- Minimize 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 other securities to postpone capital gains taxes on the sales, allowing you to keep more of the sales proceeds for various 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 owed until the taxpayer has a disposition of the QRP. An ESOP advisor can ensure you receive the most tax benefit from your ESOP.
- Customize 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 test ourselves and our clients to get creative with retirement plan offerings to maximize the benefits they offer. We'll assess your needs, analyze several ESOP options, and propose a tailored ESOP that meets legal requirements and is aimed at maximizing benefits. If it makes sense, we may also recommend combining an ESOP with a 401(k) or different 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 find the best tax-advantaged retirement plans for their business. 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 examine:
- 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 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, lawyers, and a trustee to buy stock of the company on behalf of the ESOP. An experienced ESOP advisor with a strong network in Lemay, MO can help you establish your ESOP team with trusted partners.
- Ensure compliance — IRS, Department of Labor, and ERISA all have strict guidelines for the oversight of employee stock ownership plans. For instance, when ESOP participants at a closely held employer receive company stock in an ESOP distribution, they have the right to ask for the employer to buy back them at current market price.
- 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 implications for your company. ESOP advisors can plan for these changes and adapt to them in real time, allowing your plan to stay feasible, in accordance with regulations, and advantageous.
- Employee communication and education — Our ESOP advisors offer group meetings and one-on-one meetings 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 acquire partial ownership of your company, but they'll feel like they're achieving ownership of their economic well-being and future.
Why Choose Correct Capital as Your ESOP Advisor in Lemay, MO
Correct Capital is an independent advisory firm that specializes in assisting business owners establish retirement plans and succession plans for their enterprises. There are multiple factors we believe make us unique from other financial advisory firms in Lemay, MO, and all over the United States:
- 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 perfectly positioned to understand the needs of each and establish 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 utmost benefit of you, your employees, and your company. We endeavor to form long-term relationships with our clients based on trust and the mutual goal of growing your and your employees' wealth.
Other services we offer in Lemay, MO:
Call Correct Capital to Speak With an ESOP Advisor in Lemay, MO Today
If you're interested in learning more about ESOPs or wish to start the process of setting one up for your Lemay, 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 value most: positioning yourself, your business, and your employees up for achievement. Contact with one of our Lemay, MO ESOP advisors today at 877-930-4015 or contact us online.
