Employee Stock Ownership Plans (ESOPs)

Employee Stock Ownership Plans (ESOPs) are unique among retirement plans. An ESOP merges the tax benefits of a qualified retirement plan with corporate finance and aligns employees’ retirement benefits with a plan sponsor’s business goals. This combination of tax-favored employee and corporate benefit is complex, but it can be a winning scenario for both parties.

Why Choose FuturePlan for ESOP Plan Design and Administration?

FuturePlan offers high-touch personalized service from local TPAs backed by the strength and security of a large national firm.

Depth of experience

ESOPs require special expertise. While many recordkeepers and TPAs can handle defined contribution plan recordkeeping, not many are up to the specific challenges presented by ESOPs. The laws and regulations affecting ESOPs are more complicated than those governing other defined contribution plans. FuturePlan retains the industry’s leading ESOP experts.

All-inclusive Administration

FuturePlan has a team of dedicated specialists to support the complexities of ESOP plans and offer everything from tracking of cash shares and market value, to asset reconciliation and eligibility determination.

Top-tier Consulting

FuturePlan provides consulting for issues of voting rights on all shares of publicly traded company stock, managing distributions to terminating or retiring employees, and more.

Ideal Candidates

ESOPs are ideal for start-ups to Fortune 500 organizations. Ideal candidates generally include:

  • Organizations that have high profitability.
  • Companies with a desire to empower employees to begin to think more like a business owner rather than an employee, which can positively affect revenue.
  • Firms that want to keep company stock in “friendly” hands.

Plan Advantages

Tax Benefits

ESOPs are a stock-based benefit plan for employees that offer tax-favored corporate financing, and special tax advantages for shareholders selling stock in a closely held C corporation.

Stock Advantages

ESOPs provide a market for thinly traded stock and allow employers to make dividends deductible at the corporate level.

Corporate Goal Alignment

These plans provide a means for business perpetuation (e.g., when there is no buyer for a departing owner), and liquidity for estates of business owners.