ESOP advisor in Rock Hill, MO. Employee stock ownership plans (ESOPs) have become an increasingly common retirement benefit for employees in a variety of sectors in Rock Hill, MO. They offer business owners a chance to exit their company while considerably 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 Rock Hill, MO business owners can do by themselves. Correct Capital's proficient and savvy ESOP advisors help businesses of all sizes, in Rock Hill, MO and around the nation, create tailored retirement plans that benefit themselves, their employees, and their profit.
If you're in search of an experienced financial partner in Rock Hill, MO who shares your goals of creating your company and employees for prolonged success, call Correct Capital at 314-930-4015, contact us online, or schedule an appointment with one of our financial advisors immediately.
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 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 ownership and other executives. 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 stock market value.
Perhaps most importantly, 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 immediately. In many cases, ESOPs are a transition 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 not subject to federal income taxes
- Align the goals of employees and stockholders
- Offer a higher value proposition when hiring
- Boost employee motivation and productivity
- Enhance employee retention and loyalty
- Enable succession planning and business continuity
- Maintain control while arranging or easing into retirement
- Amplify 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 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 put in their own money to obtain additional stock through payroll deductions, or the company can match employee contributions with stock 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, introducing an ESOP or KSOP to a more traditional retirement plan allows you to obtain the benefits of both. The experienced Rock Hill, MO ESOP advisors and retirement consultants of Correct Capital can aid you find the right plans for your business.
How Our Rock Hill, MO ESOP Advisors Can Help
Whether you're moving on from control of your company or are interested in an ESOP's other benefits, you'll need a knowledgeable Rock Hill, MO ESOP advisory firm to partner with to reap the most benefits 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 can reinvest the proceeds in different securities to postpone capital gains taxes on the sales, permitting you to keep more of the sales proceeds for various purposes. To defer capital gains taxes, your ESOP advisor can help you perform 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 sale of the QRP. An ESOP advisor can guarantee you obtain the most tax benefit from your ESOP.
- Personalize 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 maximize the advantages they provide. We'll evaluate your needs, assess different ESOP options, and propose a customized ESOP that meets legal requirements and is aimed at maximizing benefits. If we believe it'll work, we may also suggest combining an ESOP with a 401(k) or other retirement plans to additionally increase 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 identify the optimal tax-advantaged retirement plans for their business. For clients interested in an ESOP, part of that means conducting 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 assess 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 CPAs, attorneys, and a trustee to acquire stock of the company on behalf of the ESOP. An experienced ESOP advisor with a strong network in Rock Hill, MO can help you set up your ESOP team with trusted partners.
- Ensure compliance — IRS, Department of Labor, and ERISA all have strict regulations for the administration of employee stock ownership plans. For example, when employees participating in an ESOP at a closely held employer receive company stock in an ESOP distribution, they have the option to demand the employer to buy back them at market value.
- 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 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 respond to them in real time, allowing your plan to stay workable, compliant, and beneficial.
- Employee communication and education — Our ESOP advisors offer group meetings and individual consultations 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 a share of your company, but they'll feel like they're obtaining ownership of their economic well-being and future.
Why Choose Correct Capital as Your ESOP Advisor in Rock Hill, MO
Correct Capital is an independent advisory firm that specializes in assisting business owners create retirement plans and succession plans for their businesses. There are several factors we believe distinguish us from other financial advisory firms in Rock Hill, MO, and across the United States:
- 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 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 aid in setting up retirement plans, we're well-prepared to understand the needs of each and create a plan that meets the needs of both, as well as those of your stockholders.
- Our award-winning Rock Hill, 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 best serve each client uniquely.
- 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 aim to forge long-term relationships with our clients based on trust and the mutual goal of expanding your and your employees' financial prosperity.
Other services we offer in Rock Hill, 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 Rock Hill, MO Today
If you're interested in learning more about ESOPs or wish to commence the process of setting one up for your Rock Hill, MO business, contact a Correct Capital ESOP advisor now. Let us do what we do best so you can focus on what you care about most: positioning yourself, your business, and your employees up for prosperity. Reach out with one of our Rock Hill, MO ESOP advisors immediately at 314-930-4015 or contact us online.