ESOP advisor in O'Fallon, IL. Employee stock ownership plans (ESOPs) have become an increasingly common retirement benefit for employees in various industries in O'Fallon, IL. 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 increases their productivity and motivation. However, designing, implementing, and maintaining an ESOP isn't something most O'Fallon, IL business owners can do by themselves. Correct Capital's proficient and savvy ESOP advisors help businesses of all sizes, in O'Fallon, IL and around the country, establish tailored retirement plans that benefit themselves, their employees, and their bottom line.
If you're in search of an experienced financial partner in O'Fallon, IL who shares your goals of setting up your company and employees for enduring success, call Correct Capital at 877-930-4015, contact us online, or schedule a consultation with one of our financial advisors at this moment.
Schedule a Meeting With an Advisor Today
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.
Schedule a 15-Minute Introductory Call
More From Correct Capital Wealth Management
Explore how Correct Capital Wealth Management can help guide you toward smarter decisions, clearer goals, and lasting financial success.
Subscribe To Our Newsletter Listen To Our Podcast Watch Our YouTube Channel
What Is an Employee Stock Ownership Plan (ESOP)?
An ESOP is a tax-advantaged retirement plan where employees receive stock 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 decision-making shares, meaning control of the company stays with the C-suite. They offer fantastic 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 stock 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 at once. In many cases, ESOPs are a succession plan that keeps the most amount of money achievable 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 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
- Enhance employee motivation and productivity
- Improve employee retention and loyalty
- Simplify succession planning and business continuity
- Maintain control while planning or easing into retirement
- Boost 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 extended to employees as in an ESOP, employees can deposit their own money to acquire 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 more diverse investments. In fact, including an ESOP or KSOP to a more traditional retirement plan allows you to receive the benefits of both. The experienced O'Fallon, IL ESOP advisors and retirement consultants of Correct Capital can aid you find the right plans for your business.
How Our O'Fallon, IL ESOP Advisors Can Help
Whether you're motivated by a succession plan, employee incentives, or any other of ESOPs' benefits, you'll need a knowledgeable O'Fallon, IL ESOP advisory firm in your corner 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 transfer your ownership shares to an ESOP, you have the option to reinvest the proceeds in alternative securities to defer capital gains taxes on the sales, allowing you to retain more of the sales proceeds for various purposes. 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 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 guarantee you obtain 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 imaginative with retirement plan offerings to enhance the advantages they offer. We'll evaluate your needs, assess various ESOP options, and suggest 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 other retirement plans to further increase benefits, without sacrificing efficiencies.
- Conduct a ESOP feasibility study — When we first meet with our clients, we work to comprehend their needs and work together with them to identify the best qualified retirement plans for their business. For clients interested in an ESOP, part of that means carrying out a feasibility analysis to determine 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 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 CPAs, lawyers, and a trustee to acquire stock of the company on behalf of the ESOP. An experienced ESOP advisor with a strong network in O'Fallon, IL can help you arrange 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 example, 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 market value.
- ESOP sustainability assessments — In an ESOP, shares are granted to employees over time based on seniority of service. Most of the time, that means ownership of the company is sold 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 develops 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 viable, in accordance with regulations, and beneficial.
- Employee communication and education — Our ESOP advisors offer collective workshops and personalized 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 get 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 O'Fallon, IL
Correct Capital is an independent advisory firm that specializes in helping business owners create retirement plans and succession plans for their enterprises. There are several factors we point to that distinguish us from other investment advisory agencies in O'Fallon, IL, and throughout the nation:
- We know 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 well-prepared to understand the requirements of each and develop a plan that satisfies the requirements of both, as well as those of your stockholders.
- As independent fiduciary advisors, we are lawfully and ethically 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 based on trust and the shared goal of increasing your and your employees' monetary well-being.
Other services we offer in O'Fallon, IL:

Call Correct Capital to Speak With an ESOP Advisor in O'Fallon, IL Today
If you're interested in learning more about ESOPs or wish to commence the process of setting one up for your O'Fallon, IL business, contact a Correct Capital ESOP advisor today. Let us do what we do best so you can concentrate on what you value most: setting yourself, your business, and your employees up for success. Get in touch with one of our O'Fallon, IL ESOP advisors now at 877-930-4015 or contact us online.