Other Retirement Plan Strategies

ESOP Trust Transactions

An Employee Stock Ownership Plan (ESOP) is a type of tax-qualified Defined Contribution retirement plan, in which employees have partial ownership of your business.

What are the advantages of an ESOP?

• Attract, reward, and retain employees
• Buy out one or more owners
• Create a more motivated workforce
• Raise capital or build debt capacity
• Provide a takeover defense
• Establish a market for stock in a closely held business

Valuable tax advantages

Congress has created several tax incentives that make ESOPs beneficial, including:

• Tax-deductible contributions may be used to acquire company stock
• Private companies may be able to defer capital gains
• Companies may be able to deduct dividend or lower tax liability
• Participants may experience tax-deferred retirement savings