EMPLOYEE STOCK OWNERSHIP PLAN
 

THE RIGHT EMPLOYEE RETIREMENT PLAN CAN BE A WIN-WIN SITUATION FOR EMPLOYEES AND BUSINESS OWNERS.

 

Mazars USA helps clients determine the best business strategy for long term success.

 

 

THE ADVANTAGES OF EMPLOYEE STOCK OWNERSHIP PLANS

 

An Employee Stock Ownership Plan (“ESOP”), can be an excellent tool to improve liquidity and ensure a stable succession. They offer employees an ownership interest in the company, allowing them to invest retirement savings primarily in the stock of the employer. And, as with other retirement savings, ESOP contributions are fully tax deductible and can increase cash flow because employers can make plan contributions in the form of stock.

 

Having a stake in the company offers employees greater incentive to support your business’s success in the long term. The funds raised by an ESOP can finance a range of items – from an ownership transition, to raising new equity capital, refinancing debt or acquiring new assets. They can also increase cash flow by making plan contributions in stock instead of cash. If the business is a Sub-S corporation, ESOP is not taxable on its share of corporate earnings – if wholly owned by an ESOP, that is all of its earnings.

 

However, as with other employee benefit plans, ESOPs must comply with applicable laws like ERISA, along with additional special requirements. This level of complexity can make it challenging for a business to determine if it is advantageous to put an ESOP in place and then set it up so that the plan is in compliance with all regulations.

 

 

How Mazars Helps

 

Our process starts by analyzing the needs of the owners to determine if the ESOP is the best strategy to move forward in planning. We explore any available alternatives with clients. including mezzanine financing, defined benefit plans, sale of the company, along with the ESOP to help our clients make the best choice for their situation. The Mazars team has helped various clients across industries from inception through maturity of their ESOP transactions.

 

 

 
IDEAL TAX STRUCTURE
We work with owners in coordinating ideal tax structures for maximizing the benefits of entering an ESOP transaction.
  
 
QUALIFIED REPLACEMENT PROPERTY
Mazars also assists owners in navigating the intricacies of qualified replacement property obtained once transaction is complete.
  

 

 

ESOP Benefits
  Increased Cash Flow and Profitability
Improved Employee Productivity and Motivation
Reduced Turnover
Diversification of Equity while Retaining Business Control
Enhanced Access to Capital
Smooth Succession and Retirement for Stockholders
 

 

Ira Cooperman | Partner
  516.282.7269
  Ira.Cooperman@MazarsUSA.com
  Detailed profile
 
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MAZARS INTERNATIONAL TAX CONFERENCE 2019
October 3, 2019

 

We are delighted to be hosting the Mazars Annual International Tax Conference on 3 October 2019, kindly supported by King’s College London.

Our 2019 conference focuses on: Tax in the next decade: preparing for 2020 and beyond.

The conference gives a unique opportunity to discuss and debate international tax topics featuring panel discussions in the morning with a detailed discussion about the future of tax driven by BEPS 2.0 and the challenges for MNEs, and break-out sessions in the afternoon.

 


Learn more

 
 

EMPLOYEE STOCK OWNERSHIP PLAN

THE RIGHT EMPLOYEE RETIREMENT PLAN CAN BE A WIN-WIN SITUATION FOR EMPLOYEES AND BUSINESS OWNERS.

Mazars USA helps clients determine the best business strategy for long term success.


THE ADVANTAGES OF EMPLOYEE STOCK OWNERSHIP PLANS

 

An Employee Stock Ownership Plan (“ESOP”), can be an excellent tool to improve liquidity and ensure a stable succession. They offer employees an ownership interest in the company, allowing them to invest retirement savings primarily in the stock of the employer. And, as with other retirement savings, ESOP contributions are fully tax deductible and can increase cash flow because employers can make plan contributions in the form of stock.

 

Having a stake in the company offers employees greater incentive to support your business’s success in the long term. The funds raised by an ESOP can finance a range of items – from an ownership transition, to raising new equity capital, refinancing debt or acquiring new assets. They can also increase cash flow by making plan contributions in stock instead of cash. If the business is a Sub-S corporation, ESOP is not taxable on its share of corporate earnings – if wholly owned by an ESOP, that is all of its earnings.

 

However, as with other employee benefit plans, ESOPs must comply with applicable laws like ERISA, along with additional special requirements. This level of complexity can make it challenging for a business to determine if it is advantageous to put an ESOP in place and then set it up so that the plan is in compliance with all regulations.

 

How Mazars Helps

 

Our process starts by analyzing the needs of the owners to determine if the ESOP is the best strategy to move forward in planning. We explore any available alternatives with clients. including mezzanine financing, defined benefit plans, sale of the company, along with the ESOP to help our clients make the best choice for their situation. The Mazars team has helped various clients across industries from inception through maturity of their ESOP transactions.

 

 
IDEAL TAX STRUCTURE
We work with owners in coordinating ideal tax structures for maximizing the benefits of entering an ESOP transaction.
  
 
QUALIFIED REPLACEMENT PROPERTY
Mazars also assists owners in navigating the intricacies of qualified replacement property obtained once transaction is complete.
  
ESOP Benefits
  Increased Cash Flow and Profitability
Improved Employee Productivity and Motivation
Reduced Turnover
Diversification of Equity while Retaining Business Control
Enhanced Access to Capital
Smooth Succession and Retirement for Stockholders

 

How Mazars Helps

Our process starts by analyzing the needs of the owners to determine if the ESOP is the best strategy to move forward in planning. We explore any available alternatives with clients. including mezzanine financing, defined benefit plans, sale of the company, along with the ESOP to help our clients make the best choice for their situation. The Mazars team has helped various clients across industries from inception through maturity of their ESOP transactions. We work with owners in coordinating ideal tax structures for maximizing the benefits of entering an ESOP transaction. Mazars also assists owners in navigating the intricacies of qualified replacement property obtained upon consummating the transaction.

 

Ira Cooperman | Partner
  516.282.7269
  Ira.Cooperman@MazarsUSA.com
  Detailed profile