ESOP advisor in St. Charles, MO. Employee stock ownership plans (ESOPs) are becoming a more and more well-liked retirement plan for employees in a variety of sectors in St. Charles, MO. They offer business owners an opportunity to move on from their company while substantially 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 St. Charles, MO business owners can do by themselves. Correct Capital's knowledgeable and savvy ESOP advisors help businesses of all sizes, in St. Charles, MO and around the United States, design tailored retirement plans that benefit themselves, their employees, and their profit.
If you're in search of a trustworthy financial partner in St. Charles, MO who shares your goals of building your company and employees for sustained success, call Correct Capital at 877-930-4015, contact us online, or schedule an appointment with one of our financial advisors today.
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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.
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About Employee Stock Ownership Plans (ESOPs)
An ESOP is a qualified retirement plan where employees receive stock of the company that employs them, rather than savings accounts 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 controlling shares, meaning control of the company stays with ownership and other executives. They offer excellent incentives to employees while providing businesses with a superior value proposition to employees, and allow business owners to set up a succession plan while maintaining control. When they retire, most employees sell the stock at marketplace 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 right away. In many cases, ESOPs are a succession plan that keeps the most amount of money feasible 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)
- 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 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
- Enhance employee retention and loyalty
- Ease succession planning and business continuity
- Keep 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 similar type of plan that is a combination of 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 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 get the benefits of both. The experienced St. Charles, MO ESOP advisors and retirement consultants of Correct Capital can assist you find the right plans for your business.
What Our St. Charles, MO ESOP Advisors Do for You
Whether you're moving on from ownership of your company or are interested in an ESOP's other benefits, you'll need a knowledgeable St. Charles, MO ESOP advisory firm in your corner to get the most out of your plan. When you work with Correct Capital, we:
- Lower 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 carry out 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.
- Customize your ESOP and retirement plans — Along with your team, we'll design and set up 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 maximize the advantages they provide. We'll evaluate your needs, assess several ESOP options, and recommend a personalized ESOP that meets legal requirements and is aimed at maximizing benefits. If we believe it'll work, we may also advise combining an ESOP with a 401(k) or other retirement plans to further boost benefits, without sacrificing efficiencies.
- Conduct a ESOP feasibility study — When we first meet with our clients, we work to grasp their needs and collaborate with them to discover the optimal 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 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 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 St. Charles, MO can help you establish your ESOP team with trusted partners.
- Ensure compliance — IRS, Department of Labor, and ERISA all have strict guidelines for the administration of retirement plans. For instance, when ESOP participants at a closely held employer receive company stock in an ESOP distribution, they have the option to ask for the employer to repurchase them at current market price.
- 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 increments. 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, allowing your plan to stay viable, in accordance with regulations, and advantageous.
- Employee communication and education — Our ESOP advisors offer collective workshops and personalized meetings with your employees so they can maximize the benefits from your ESOP. With an ESOP advisor from Correct Capital, your employees won't just attain a share of your company, but they'll feel like they're obtaining ownership of their financial stability and future.
Why Choose Correct Capital as Your ESOP Advisor in St. Charles, MO
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 set us apart from other investment advisory agencies in St. Charles, MO, and all over the United States:
- We know 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 to aid in setting up retirement plans, we're perfectly positioned to understand the requirements of each and establish a plan that satisfies the requirements of both, as well as those of your stockholders.
- As independent fiduciary advisors, we are legally and ethically bound to do what's in the utmost benefit of you, your employees, and your company. We endeavor to forge long-term relationships with our clients grounded in trust and the mutual goal of expanding your and your employees' monetary well-being.
Other services we offer in St. Charles, MO:
Call Correct Capital to Speak With an ESOP Advisor in St. Charles, MO Today
If you're interested in learning more about ESOPs or desire to start the process of setting one up for your St. Charles, MO business, reach out to a Correct Capital ESOP advisor today. Let us do what we do best so you can focus on what you value most: positioning yourself, your business, and your employees up for prosperity. Get in touch with one of our St. Charles, MO ESOP advisors immediately at 877-930-4015 or contact us online.
