Employee Stock Ownership Plans Grow In Popularity
It’s not uncommon for business owners to be tripped up by the wily adversary that is succession planning; not because they didn’t see retirement coming up on the horizon, but because they spent years in the weeds and caught up in the notion that this critical stage in their life is still a long ways away. 与此同时, they press on … and about the time they do slow down to assess their situation, they find that the years have passed and their options are limited.
Succession planning isn’t a strategy to take on at the end of your career – quite the contrary. The sooner you identify your succession plan and exit strategy, the better.
When To Start Planning Your Exit?
Identifying an exit plan isn’t just about determining the best time to cut and run. 而, it’s about questioning the type of legacy you’d like to leave behind while securing the best future possible for you and your loved ones. 此外, the most successful succession plans are those that are well thought out and pursued many years before you even consider retirement.
在过去的几年里, business owners have increasingly found an ideal solution with the implementation of an Employee Stock Ownership Plan (ESOP). This particular option has allowed many owners to stay involved in the business while laying the groundwork for the company’s ongoing success. That being said, it’s not the right fit for everybody.
什么是员工持股计划?
员工持股计划允许你, 企业主, to sell up to 100 percent of your company’s stock to your employees. This option is great if you want to ensure your business, and your philosophy lives on and that your employees are taken care of after you’re gone. 另外, as part-owners of the company, your employees become more vested in the success of the company. 最后, an ESOP gives you the opportunity to stay as involved in the company for as long as you like.
在过去, owners were turned off by the complexities of this particular strategy and lenders were hesitant to provide the necessary funding. This isn’t the case any longer. These days, more is known about ESOPs. 结果是, owners are now realizing that there are many great benefits associated with converting to an ESOP model.
While ESOPs certainly have their endearing qualities, there are, of course, a few risks to consider. For example, sometimes, an ESOPs will replace the company’s traditional retirement plan. 以这种方式, employee’s become more financially vulnerable in the event the company runs into financial struggles or even bankruptcy. One way to mitigate this particular risk is to provide your employees with multiple diversified retirement plan strategies from which to choose. 另外, it’s important to note that your ESOP will be regulated by the IRS and the Department of Labor, which means your company will be subjected to additional oversight.
Will An ESOP Work For Your Business?
Having an ESOP in place is a great way to reward your employees for their work at your business and enhance your business’s retirement plan offering, but they aren’t going to work for all businesses. When determining whether an ESOP makes sense for your company, you’ll first need to consider your size and profitability. A seasoned and competent management team is also a MUST HAVE for an ESOP conversion to be successful.
The first step in your ESOP conversion process is to conduct an ESOP feasibility and structure analysis. This particular service will provide you with the objective data you’ll need to determine if an ESOP makes sense, including an analysis of your potential after-tax proceeds if you sell to an ESOP and an affordability analysis from the company’s perspective.
Start Your Succession Plan Today
不幸的是, 对任何人来说，时间都不会变慢, which means if you have a business, you have a serious responsibility to yourself, your family and your employees and customers to determine your next steps – long before you start finalizing your plans to move to Florida. Email the business valuations and succession planning team 在意图 & 比较靠谱的赌博软件 to learn more about your options, including the process of conducting an ESOP feasibility study.
By Paul Weisinger, CPA/ABV, CVA, CEPA 克利夫兰(办公室)