Employee Stock Ownership Plan (ESOP)
Thinking about succession planning for your business? Consider an ESOP
An ESOP has numerous tax advantages to help you transition your business and give employees an ownership interest. However, ESOP plans are complex, with numerous rules and requirements that are distinct from other qualified retirement plans. USI Consulting Group (USICG) understands the challenges you face and the numerous priorities that need to be addressed – expertly, efficiently and cost-effectively.
Your top challenges
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Succession planning for business owners ready to retire or sell |
Timing of sale and succession |
Financial resources to buy out owners and remain independent |
Providing fair value to retiring business owners |
Retaining employees who helped build the value of business |
Your objectives
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Promote employee ownership |
Create value for shareholders with favorable tax treatment |
Remain independent, locally-owned |
Minimize corporate taxes and maximize cash preservation |
Recruit and retain great employees |
What is an ESOP?An ESOP is an employee benefit plan that invests primarily in the company’s stock providing an opportunity for eligible employees to share company ownership. Employees do not contribute financially to an ESOP and the plan is typically funded by company contributions. |
Two types of ESOP configurations
STAND ALONE ESOPAn entirely separate and independent plan. Typically, employers also offer a separate 401(k) alongside their ESOP Plan. |
KSOP: combined ESOP + 401(k)A combined ESOP and 401(k) under the umbrella of a single plan arrangement. |
Why create an ESOP?
Tax-efficient business succession at fair value
Flexible, gradual sale and transition
ESOP companies remain independent, locally-owned and strong in their communities
Businesses perform well with tax advantages
Companies continue the mission and values of shareholders
ESOPs benefit the people who created value for the shareholders
ESOP candidates
- Established business and reputation
- Strong management team
- C or S Corporation
- Little or no debt on the balance sheet
- Consistent or increasing cash flow and earnings
- 20 or more non-shareholder employees
- Positive culture, strong mission and values
Tax-Efficiency | Flexibility | Fair Value | Reward | Independence | Legacy
Learn more about how USICG can help employers with ESOPs
Learn about the rules, requirements and process of setting up an ESOP
Learn how our ESOP experts can deliver custom, full-service consulting for ESOPs
Learn about our customized strategies to help you optimize your resources and goals
We are your trusted partner. Our integrated team of highly skilled professionals provides specialized expertise to drive positive outcomes for you and your employees, including:
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Offer cost-effective, competitive plan to attract and retain talent |
Minimize corporate taxes and maximize cash preservation |
Secure protection and mitigate risk |
Ease administrative burden, saving time and money |
Ensure employees understand the value offered through your ESOP |
The Perks of an Enhanced ESOP Exit Strategy
In case you missed it, we hosted a webinar with Fox Rothschild discussing how an Employee Stock Ownership Plan (ESOP) can provide financial security, preserve your company’s legacy and create a motivated workforce – all while achieving your exit strategy.
How USI Consulting Group can help
USI Consulting Group is your trusted partner with a strong commitment to customer satisfaction. We will work with you to structure your plan to maximize benefits for your company, employees and stockholders.
If you are interested in learning how your organization can benefit from our ESOP and/or 401(k) solutions, please reach out to us at information@usicg.com.
1023.S1026.0080
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