ESOP advisor in Olivette, MO. Employee stock ownership plans (ESOPs) are becoming a more and more popular retirement plan for employees in a variety of sectors in Olivette, MO. They offer business owners a chance to exit their company while greatly reducing taxes on the sale, and offer employees a qualified retirement plan that increases their investment in your company. However, designing, implementing, and maintaining an ESOP isn't something most Olivette, MO business owners can do by themselves. Correct Capital's seasoned and savvy ESOP advisors help businesses of all sizes, in Olivette, MO and around the United States, develop tailored retirement plans that benefit themselves, their employees, and their bottom line.
If you're seeking a trustworthy financial partner in Olivette, MO who shares your goals of creating your company and employees for long-term success, call Correct Capital at 877-930-4015, contact us online, or schedule a consultation with one of our financial advisors right away.
About Employee Stock Ownership Plans (ESOPs)
An ESOP is a tax-advantaged retirement plan where employees receive shares of the company they work for, rather than savings accounts 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 governing 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 in the hiring process, and allow business owners to set up a succession plan while retaining control. When they retire, most employees sell the stock at market value.
Of special interest to business owners, by handing over part of your ownership to the ESOP, owners can defer capital gains taxes, allowing you to spread out that tax hit instead of needing to pay taxes promptly. In many cases, ESOPs are a succession plan that keeps the most amount of money attainable 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)
- Additional 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
- Provide a higher value proposition when hiring
- Increase employee motivation and productivity
- Improve employee retention and loyalty
- Ease 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 offered to employees as in an ESOP, employees can add their own money to purchase additional stock 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 more diverse investments. In fact, including an ESOP or KSOP to a more traditional retirement plan allows you to obtain the benefits of both. The experienced Olivette, MO ESOP advisors and retirement consultants of Correct Capital can support you find the right plans for your business.
How Our Olivette, MO 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 Olivette, MO ESOP advisory firm in your corner to reap the most benefits 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 can reinvest the proceeds in alternative securities to postpone capital gains taxes on the sales, permitting you to retain more of the sales proceeds for other 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 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 challenge ourselves and our clients to get imaginative with retirement plan offerings to enhance the benefits they provide. We'll examine your needs, assess various ESOP options, and suggest a personalized 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 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 grasp their needs and collaborate with them to identify the optimal tax-advantaged 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 viable 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 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 partner 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, attorneys, and a trustee to buy stock of the company on behalf of the ESOP. An experienced ESOP advisor with a strong network in Olivette, MO can help you set up your ESOP team with reliable partners.
- Ensure compliance — IRS, Department of Labor, and ERISA all have strict guidelines for the management of employee stock ownership plans. For example, when ESOP participants at a closely held employer receive company stock in an ESOP distribution, they have the option to require the employer to repurchase them at fair market value.
- 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 sold 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 evolves and matures, so will its impact on your company. ESOP advisors can plan for these changes and react to them in real time, enabling 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 retirement plan. With an ESOP advisor from Correct Capital, your employees won't just acquire a share of your company, but they'll feel like they're achieving ownership of their financial stability and future.
Why Choose Correct Capital as Your ESOP Advisor in Olivette, MO
Correct Capital is an independent advisory firm that specializes in assisting business owners establish retirement plans and succession plans for their companies. There are several factors we point to that set us apart from other financial consulting companies in Olivette, MO, and throughout the country:
- We know retirement plans and ESOPs. Correct Capital's clients currently operate these plans in a 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 well-prepared to understand the needs of each and develop a plan that satisfies the needs 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 optimal interest of you, your employees, and your company. We strive to form long-term relationships with our clients grounded in trust and the common goal of increasing your and your employees' wealth.
Other services we offer in Olivette, MO:
Call Correct Capital to Speak With an ESOP Advisor in Olivette, MO Today
If you're interested in learning more about ESOPs or wish to initiate the process of setting one up for your Olivette, MO business, contact a Correct Capital ESOP advisor today. Let us do what we do best so you can focus on what you value most: setting yourself, your business, and your employees up for success. Reach out with one of our Olivette, MO ESOP advisors immediately at 877-930-4015 or contact us online.
