ESOP advisor in Webster Groves, MO. Employee stock ownership plans (ESOPs) are becoming a more and more well-liked retirement plan for employees in various industries in Webster Groves, MO. They offer business owners an opportunity to step away from their company while considerably reducing taxes on the sale, and offer employees a tax-advantaged retirement plan that increases their investment in your company. However, designing, implementing, and maintaining an ESOP isn't something most Webster Groves, MO business owners can do without professional help. Correct Capital's seasoned and savvy ESOP advisors help businesses of all sizes, in Webster Groves, MO and around the U.S., create tailored retirement plans that benefit themselves, their employees, and their bottom line.
If you're looking for an experienced financial partner in Webster Groves, MO who shares your goals of setting up your company and employees for enduring success, call Correct Capital at 314-930-4015, contact us online, or schedule a consultation with one of our financial advisors now.
About Employee Stock Ownership Plans (ESOPs)
An ESOP is a tax-advantaged retirement plan where employees receive stock of the company they work for, rather than savings funds or investments in other companies such as in a 401(k). 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 a better value proposition to employees, and allow business owners to set up a succession plan while preserving control. Upon reaching retirement, most employees sell the stock at marketplace value.
Of special interest to business owners, by selling part of your ownership to the ESOP, owners can defer capital gains taxes, allowing you to disperse that tax hit instead of being required to pay taxes at once. In many cases, ESOPs are a transition 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 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
- Offer a higher value proposition when hiring
- Boost employee motivation and productivity
- Enhance employee retention and loyalty
- Facilitate succession planning and business continuity
- Retain control while organizing or easing into retirement
- Amplify personal liquidity of owners, but still hold on to control of the company
- Preserve 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 contribute their own money to obtain additional shares 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, adding an ESOP or KSOP to a more traditional retirement plan allows you to attain the benefits of both. The experienced Webster Groves, MO ESOP advisors and retirement consultants of Correct Capital can support you find the right plans for your business.
How Our Webster Groves, 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 a knowledgeable Webster Groves, MO ESOP advisory firm in your corner to get the most out 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 other securities to defer capital gains taxes on the sales, permitting you to retain more of the sales proceeds for different 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 owed until the taxpayer has a sale of the QRP. An ESOP advisor can ensure you get the most tax benefit from your ESOP.
- Customize your ESOP and retirement plans — Along with your team, we'll design and execute an ESOP that works best for you and your distinctive company. We like to challenge ourselves and our clients to get innovative with retirement plan offerings to optimize the benefits they offer. We'll assess your needs, evaluate different ESOP options, and recommend a tailored 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 augment benefits, yet retain 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 business. For clients interested in an ESOP, part of that means carrying out a feasibility analysis to establish 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 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 accountants, attorneys, and a trustee to purchase stock of the company on behalf of the ESOP. An experienced ESOP advisor with a strong network in Webster Groves, MO can help you arrange your ESOP team with trusted partners.
- Ensure compliance — IRS, Department of Labor, and ERISA all have strict requirements for the administration of retirement 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 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. Most of the time, 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 progresses and matures, so will its impact on your company. ESOP advisors can plan for these changes and respond to them in real time, facilitating your plan to stay feasible, in accordance with regulations, and advantageous.
- Employee communication and education — Our ESOP advisors offer group meetings and personalized meetings 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 portion 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 Webster Groves, MO
Correct Capital is an independent advisory firm that specializes in assisting business owners create retirement plans and succession plans for their enterprises. There are multiple factors we point to that make us unique from other financial consulting companies in Webster Groves, MO, and all over the country:
- 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 wide range of sectors, including for construction companies and contractors. As we work with both businesses and individuals and families when managing retirement plans, we're perfectly positioned to understand the demands of each and develop a plan that fulfills the needs of both, as well as those of your stockholders.
- Our award-winning Webster Groves, 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 80 years of combined experience, we pool our collective talents and insights to effectively cater to 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 endeavor to form long-term relationships with our clients founded on trust and the shared goal of growing your and your employees' wealth.
Other services we offer in Webster Groves, 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 Webster Groves, MO Today
If you're interested in learning more about ESOPs or aspire to start the process of setting one up for your Webster Groves, MO business, get in touch with a Correct Capital ESOP advisor now. Let us do what we do best so you can focus on what you care about most: setting yourself, your business, and your employees up for prosperity. Reach out with one of our Webster Groves, MO ESOP advisors now at 314-930-4015 or contact us online.