ESOP advisor in Oakland, MO. Employee stock ownership plans (ESOPs) are becoming a more and more common retirement benefit for employees in various industries in Oakland, MO. They offer business owners an opportunity to step away from their company while substantially reducing taxes on the sale, and offer employees a tax-advantaged retirement plan that builds their productivity and motivation. However, designing, implementing, and maintaining an ESOP isn't something most Oakland, MO business owners can do without professional help. Correct Capital's proficient and savvy ESOP advisors help businesses of all sizes, in Oakland, MO and around the country, create tailored retirement plans that benefit themselves, their employees, and their bottom line.
If you're in search of a trustworthy financial partner in Oakland, MO who shares your goals of setting up your company and employees for long-term success, call Correct Capital at 314-930-4015, contact us online, or schedule a consultation with one of our financial advisors at this moment.
What Is an Employee Stock Ownership Plan (ESOP)?
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 ownership and other executives. They offer great incentives to employees while providing businesses with a superior value proposition to employees, and allow business owners to set up a succession plan while preserving control. When they retire, most employees sell the stock at stock market value.
Perhaps most importantly, by selling part of your ownership to the ESOP, owners can defer capital gains taxes, allowing you to distribute that tax hit instead of needing to pay taxes immediately. In many cases, ESOPs are a succession 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
- Increase employee motivation and productivity
- Boost employee retention and loyalty
- Facilitate succession planning and business continuity
- Retain control while planning or easing into retirement
- Increase 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 similar type of plan that is a combination of an ESOP and a 401(k). Ownership shares are given to employees as in an ESOP, employees can add their own money to obtain additional shares through payroll deductions, or the company can match employee contributions with shares 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, including an ESOP or KSOP to a more traditional retirement plan allows you to attain the benefits of both. The experienced Oakland, MO ESOP advisors and retirement consultants of Correct Capital can aid you find the best retirement plan for you, your company, and your employees.
What Our Oakland, MO ESOP Advisors Do for You
Whether you're moving on from control of your company or are interested in an ESOP's other benefits, you'll need a knowledgeable Oakland, 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 defer capital gains taxes on the sales, allowing you to keep more of the sales proceeds for other 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 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 guarantee you receive the most tax benefit from your ESOP.
- Customize your ESOP and retirement plans — Along with your team, we'll design and execute an ESOP suited specifically to you and your company. We like to push ourselves and our clients to get imaginative with retirement plan offerings to maximize the advantages they offer. We'll examine your needs, analyze several ESOP options, and propose a personalized 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 other retirement plans to further augment benefits, yet retain efficiencies.
- Conduct a ESOP feasibility study — When we first meet with our clients, we work to grasp their needs and collaborate with them to identify the best tax-advantaged retirement plans for their business. For clients looking at an ESOP, part of that means conducting a feasibility analysis to ascertain if it's a feasible option for your company. We'll analyze:
- 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 buy stock of the company on behalf of the ESOP. An experienced ESOP advisor with a strong network in Oakland, 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 administration of retirement plans. For instance, when ESOP participants at a closely held employer receive company stock in an ESOP distribution, they have the option to ask for the employer to repurchase 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. 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 react to them in real time, allowing your plan to stay viable, compliant, and profitable.
- Employee communication and education — Our ESOP advisors offer collective workshops and personalized meetings with your employees so they can optimize the advantages from your employee stock ownership plan. With an ESOP advisor from Correct Capital, your employees won't just get a portion 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 Oakland, MO
Correct Capital is an independent advisory firm that specializes in helping business owners create retirement plans and succession plans for their companies. There are multiple factors we believe distinguish us from other financial consulting companies in Oakland, 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 to assist in setting up retirement plans, we're ideally suited to understand the demands of each and establish a plan that meets the requirements of both, as well as those of your stockholders.
- Our award-winning Oakland, 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 effectively cater to each client uniquely.
- As independent fiduciary advisors, we are legally and morally bound to do what's in the best interest of you, your employees, and your company. We aim to establish long-term relationships with our clients grounded in trust and the shared goal of expanding your and your employees' financial prosperity.
Other services we offer in Oakland, 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
- Social Security Consultants Near Me
- Retirement Calculator
Call Correct Capital to Speak With an ESOP Advisor in Oakland, MO Today
If you're interested in learning more about ESOPs or wish to commence the process of setting one up for your Oakland, 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: establishing yourself, your business, and your employees up for prosperity. Get in touch with one of our Oakland, MO ESOP advisors now at 314-930-4015 or contact us online.