ESOP advisor in Oakland, MO. Employee stock ownership plans (ESOPs) are becoming a more and more popular retirement benefit for employees in various industries in Oakland, MO. They offer business owners a chance to transition from their company while substantially 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 Oakland, MO business owners can do without professional help. Correct Capital's knowledgeable and savvy ESOP advisors help businesses of all sizes, in Oakland, MO and around the country, establish tailored retirement plans that benefit themselves, their employees, and their revenue.
If you're looking for an experienced financial partner in Oakland, MO who shares your goals of establishing 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.
About Employee Stock Ownership Plans (ESOPs)
An ESOP is a qualified retirement plan where employees receive shares of the company that employs them, rather than savings funds 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 voting shares, meaning control of the company stays with the C-suite. They offer fantastic incentives to employees while providing businesses with a superior value proposition to employees, and allow business owners to set up a succession plan while maintaining control. When they retire, most employees sell the stock at market value value.
Perhaps most importantly, by transferring part of your ownership to the ESOP, owners can defer capital gains taxes, allowing you to disperse the tax consequences of the sale instead of having to pay taxes right away. 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 one day 100% owned as an S-Corp by the ESOP, it's free from federal income taxes
- Align the goals of employees and stockholders
- Present a higher value proposition when hiring
- Increase employee motivation and productivity
- Enhance employee retention and loyalty
- Simplify succession planning and business continuity
- Retain control while preparing 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 qualified plan that is a mix between an ESOP and a 401(k). Ownership shares are provided to employees as in an ESOP, employees can contribute their own money to buy 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, incorporating an ESOP or KSOP to a more traditional retirement plan allows you to receive the benefits of both. The experienced Oakland, MO ESOP advisors and retirement consultants of Correct Capital can assist you find the right plans for your business.
What Our Oakland, 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 an experienced Oakland, MO ESOP advisory firm in your corner 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 sell your ownership shares to an ESOP, you have the option to reinvest the proceeds in other securities to defer capital gains taxes on the sales, permitting you to keep more of the profit. 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 owed until the taxpayer has a disposition of the QRP. An ESOP advisor can assure you receive the most tax benefit from your ESOP.
- Customize your ESOP and retirement plans — Along with your team, we'll create and execute an ESOP that works best for you and your unique company. We like to test ourselves and our clients to get imaginative with retirement plan offerings to optimize the benefits they provide. We'll examine your needs, evaluate several ESOP options, and recommend a tailored ESOP that meets legal requirements and is aimed at optimizing benefits. If it makes sense, we may also advise combining an ESOP with a 401(k) or other retirement plans to further boost benefits, yet retain efficiencies.
- Conduct a ESOP feasibility study — When we first meet with our clients, we work to comprehend their needs and collaborate with them to find the optimal tax-advantaged 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 feasible option for your company. We'll look at:
- 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 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 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 acquire 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 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 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 redeem 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 increments. 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 evolves 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 advantageous.
- 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 get partial ownership of your company, but they'll feel like they're gaining ownership of their financial health and future.
Why Choose Correct Capital as Your ESOP Advisor in Oakland, MO
Correct Capital is an independent advisory firm that specializes in assisting business owners establish retirement plans and succession plans for their businesses. There are numerous factors we point to that set us apart from other financial consulting companies in Oakland, MO, and throughout the nation:
- 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 support in setting up retirement plans, we're ideally suited to understand the requirements of each and create a plan that satisfies the necessities 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 forge long-term relationships with our clients based on trust and the shared goal of expanding your and your employees' wealth.
Other services we offer in Oakland, MO:
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 now. 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. Reach out with one of our Oakland, MO ESOP advisors now at 877-930-4015 or contact us online.
