ESOP advisor in Sappington, MO. Employee stock ownership plans (ESOPs) are becoming a more and more popular retirement plan for employees in various industries in Sappington, MO. They offer business owners a chance to transition from their company while significantly 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 Sappington, MO business owners can do by themselves. Correct Capital's seasoned and savvy ESOP advisors help businesses of all sizes, in Sappington, MO and around the U.S., establish tailored retirement plans that benefit themselves, their employees, and their bottom line.
If you're in search of an experienced financial partner in Sappington, MO who shares your goals of establishing your company and employees for long-term success, call Correct Capital at 314-930-4015, contact us online, or schedule an appointment with one of our financial advisors today.
What Is an Employee Stock Ownership Plan (ESOP)?
An ESOP is a tax-advantaged retirement plan where employees receive shares of the company they work for, 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 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 maintaining control. When they retire, most employees sell the stock at market value value.
Perhaps even more 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 being required to pay taxes right away. In many cases, ESOPs are a transition plan that keeps the most amount of money achievable 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
- Provide a higher value proposition when hiring
- Enhance employee motivation and productivity
- Improve employee retention and loyalty
- Enable succession planning and business continuity
- Keep control while preparing or easing into retirement
- Raise personal liquidity of owners, but still hold on to control of the company
- Carry on your business' legacy and culture
What About KSOPs?
A KSOP is a similar type of 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 obtain 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 the risk tolerance that comes with diverse investments. In fact, incorporating an ESOP or KSOP to a more traditional retirement plan allows you to get the benefits of both. The experienced Sappington, MO ESOP advisors and retirement consultants of Correct Capital can help you find the right plans for your business.
What Our Sappington, 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 a knowledgeable Sappington, MO ESOP advisory firm in your corner 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 sell 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 profit. 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 owed until the taxpayer has a disposition of the QRP. An ESOP advisor can assure you get the most tax benefit from your ESOP.
- Personalize your ESOP and retirement plans — Along with your team, we'll design and set up an ESOP that works best for you and your one-of-a-kind company. We like to test ourselves and our clients to get creative with retirement plan offerings to maximize the advantages they provide. We'll assess your needs, analyze various ESOP options, and propose a tailored ESOP that meets legal requirements and is aimed at maximizing benefits. If it makes sense, we may also suggest combining an ESOP with a 401(k) or other retirement plans to additionally increase benefits, without sacrificing efficiencies.
- Conduct a ESOP feasibility study — When we first meet with our clients, we work to comprehend their needs and collaborate with them to discover the best qualified retirement plans for their company. For clients looking at an ESOP, part of that means carrying out 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 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 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 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 acquire stock of the company on behalf of the ESOP. An experienced ESOP advisor with a strong network in Sappington, 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 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 right to require the employer to buy back them at current market price.
- ESOP sustainability assessments — In an ESOP, shares are granted to employees over time based on length of service. 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 develops and matures, so will its impact on your company. ESOP advisors can plan for these changes and react to them in real time, allowing your plan to stay viable, compliant, and advantageous.
- Employee communication and education — Our ESOP advisors offer group meetings and one-on-one 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 partial ownership of your company, but they'll feel like they're gaining ownership of their financial health and eventual retirement.
Why Choose Correct Capital as Your ESOP Advisor in Sappington, MO
Correct Capital is an independent advisory firm that specializes in assisting business owners create retirement plans and succession plans for their companies. There are several factors we point to that make us unique from other investment advisory agencies in Sappington, MO, and all over 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 range of industries, including for construction companies and contractors. As we work with both businesses and individuals and families when managing retirement plans, we're well-prepared to understand the needs of each and create a plan that meets the requirements of both, as well as those of your stockholders.
- Our award-winning Sappington, MO financial advisory team is composed of a wide 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 eight decades of combined experience, we pool our collective talents and insights to optimally assist each client uniquely.
- As independent fiduciary advisors, we are legally and morally bound to do what's in the optimal interest of you, your employees, and your company. We strive to establish long-term relationships with our clients based on trust and the common goal of growing your and your employees' monetary well-being.
Other services we offer in Sappington, MO:
- 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
- Retirement Planning
- Rollover 401(k)
Call Correct Capital to Speak With an ESOP Advisor in Sappington, MO Today
If you're interested in learning more about ESOPs or desire to start the process of setting one up for your Sappington, 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 achievement. Reach out with one of our Sappington, MO ESOP advisors immediately at 314-930-4015 or contact us online.