ESOP advisor in Shrewsbury, MO. Employee stock ownership plans (ESOPs) are becoming a more and more popular retirement plan for employees in various industries in Shrewsbury, 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 increases their productivity and motivation. However, designing, implementing, and maintaining an ESOP isn't something most Shrewsbury, MO business owners can do by themselves. Correct Capital's knowledgeable and savvy ESOP advisors help businesses of all sizes, in Shrewsbury, MO and around the nation, establish tailored retirement plans that benefit themselves, their employees, and their profit.
If you're looking for an experienced financial partner in Shrewsbury, MO who shares your goals of setting up 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 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 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 a superior 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 marketplace value.
Of special interest to business owners, by transferring 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 having to pay taxes at once. 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 eventually 100% owned as an S-Corp by the ESOP, it's not subject to 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
- Retain control while preparing or easing into retirement
- Increase 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 similar type of plan that is a mix between an ESOP and a 401(k). Ownership shares are given 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 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, adding an ESOP or KSOP to a more traditional retirement plan allows you to obtain the benefits of both. The experienced Shrewsbury, MO ESOP advisors and retirement consultants of Correct Capital can support you find the best retirement plan for you, your business, and your employees.
How Our Shrewsbury, MO ESOP Advisors Can Help
Whether you're stepping from control of your company or are interested in an ESOP's other benefits, you'll need an experienced Shrewsbury, MO ESOP advisory firm by your side 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 transfer your ownership shares to an ESOP, you have the option to reinvest the proceeds in different securities to postpone capital gains taxes on the sales, allowing you to retain more of the sales proceeds for various purposes. To postpone 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 payable until the taxpayer has a disposition of the QRP. An ESOP advisor can ensure you obtain the most tax benefit from your ESOP.
- Personalize your ESOP and retirement plans — Along with your team, we'll design and implement an ESOP suited specifically to you and your company. We like to push ourselves and our clients to get innovative with retirement plan offerings to optimize the benefits they offer. We'll examine your needs, assess various ESOP options, and recommend a customized ESOP that meets legal requirements and is aimed at optimizing benefits. If it makes sense, we may also recommend combining an ESOP with a 401(k) or different retirement plans to additionally increase benefits, without sacrificing efficiencies.
- Conduct a ESOP feasibility study — When we first meet with our clients, we work to grasp their needs and work together with them to identify the best qualified retirement plans for their company. For clients interested in an ESOP, part of that means conducting a feasibility analysis to establish if it's a workable 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 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, lawyers, and a trustee to acquire stock of the company on behalf of the ESOP. An experienced ESOP advisor with a strong network in Shrewsbury, 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 instance, when ESOP participants at a closely held employer receive company stock in an ESOP distribution, they have the right to ask for the employer to redeem 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. 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 impact on your company. ESOP advisors can plan for these changes and adapt to them in real time, enabling your plan to stay workable, compliant, and advantageous.
- Employee communication and education — Our ESOP advisors offer group sessions and individual consultations with your employees so they can get the most 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 Shrewsbury, MO
Correct Capital is an independent advisory firm that specializes in assisting business owners arrange 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 Shrewsbury, MO, and throughout 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 know retirement plans and ESOPs. Correct Capital's clients currently operate these plans in a wide range 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 ideally suited to understand the needs of each and establish a plan that meets the necessities of both, as well as those of your stockholders.
- Our award-winning Shrewsbury, MO financial advisory team is made up 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 effectively cater to each client distinctively.
- 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 endeavor to form long-term relationships with our clients founded on trust and the common goal of growing your and your employees' financial prosperity.
Other services we offer in Shrewsbury, 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
Call Correct Capital to Speak With an ESOP Advisor in Shrewsbury, MO Today
If you're interested in learning more about ESOPs or wish to initiate the process of setting one up for your Shrewsbury, MO business, get in touch with 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. Contact with one of our Shrewsbury, MO ESOP advisors now at 877-930-4015 or contact us online.
