An employee stock ownership plan (ESOP) offers an exceptional method for employers to provide equity ownership and thus a stake in the future of the overall enterprise to their employees, in our experience, often leading to increased employee satisfaction, motivation and retention.

As a Defined Contribution Plan, ESOPs are subject to the same general qualification requirements under ERISA Law as other defined contribution plans, such as 401(k), 403(b), or 401(a)s, but there are several distinguishing characteristics, tax advantages and rules plan fiduciaries must adhere to in order to meet regulatory guidelines and maximize the potential of this very attractive benefit offering.

As a full-service retirement plan consulting firm, Strategic Retirement Partners has a dedicated team of ESOP specialists, who can help your investment committee manage both the plan benefit and your obligations under ERISA.

ESOP consulting and management services include (but are not limited to):

  • Fiduciary Governance  Create responsibility grids, committee charters, review of external trustee, training of internal trustees, DOL/IRS audit support, review of policies and procedures to comply with the Great Banc Ruling. Create and maintain an audit and fiduciary file.
  • Review of Repurchase Obligation Study – A review should be done once every three to five years and/or close to when the note is up.
  • Education Coordination  Devise a strategy to help your communication committee and senior management strengthen the employee appreciation and understanding of the ESOP itself and their own role in the stock value.
  • Plan Design Support  Do you use the ESOP to receive Safe Harbor contributions?
  • Distribution Planning and Support
  • Support During DOL/IRS Audits
  • ESOP Cash Studies Adding sinking fund, funding from operations, adding debt or adding cash fund within the ESOP

Please contact us for any questions or assistance regarding your company ESOP plan.

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