Employee Stock Ownership Plans

A quote from Wayne W. Dyer is “Begin with the end in mind. Start with the outcome and work backward to make your dream possible.”   In starting your business, you need to have the end in mind concerning your succession plan.  One of your succession plans can be an Employee Stock Ownership Plans (ESOPs). 

Three benefits of ESOPs are:

  1. Liquidity Strategy
  • Can sell partial or entire company to an ESOP.
  • Keep more control and is a friendlier process than selling to a third party.
  • Provides continuity of corporate culture and company legacy.
  1. Tax Efficiency
  • Repay debt with pre-tax dollars.
  • Does not pay taxes if 100% ESOP-owned S-Corporation
  • Defer capital gains on C-Corporation if certain criteria are met.
  1. Retirement Plan
  • Protected ERISA retirement plan.
  • Grow tax deferred value within participants accounts.
  • Must repurchase stock when employee leaves.

If you have questions concerning ESOPs,  please call Susan at 630.523.5762. For more great tips on becoming a highly profitable business owner, check out Highpoint Advisory Services.


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