ESOP

ESOPs are valuable to your exit strategy because they offer a wide range of tax benefits to departing owners and employees receiving ownership of the company. We help business owners navigate their options with an ESOP as they plan their exit, whether to sell their shares back to an ESOP to possibly defer capital gains taxes or buy out the owner and other partners.

When deciding on the structure of your ESOP, you will need a full understanding of how each decision will impact your financial statements. We help plan sponsors consider the impacts of plan structure, their pros and cons and any required footnote disclosures.

Although ESOPs are a great retirement plan and exit strategy, they require careful treatment because of their impact to your company’s accounting position. We can analyze the complexity of the ESOP transaction and its many moving parts to advise on the accounting impact and appropriate financial statement treatment.

Like other retirement plans, plan sponsors for ESOPs have a fiduciary obligation to manage the plan with a priority on participants’ interests – this means you’ll need an independent third-party audit of the plan. We help ESOP plan sponsors with their benefit plan audit requirements or can facilitate an audit readiness consulting engagement or basic consulting engagement to test and assess the plan’s compliance.

As tax-exempt financial vehicles, ESOPs are valuable incentives as part of a larger company-sponsored strategy, but tax planning is critical. We analyze your company’s tax position before and after a potential transaction, including deferred income, accelerated contribution deductions, accounting method planning, bonuses and dividends and post-transaction assistance.