Introduction to employee stock ownership plans (ESOPs)Blog added by Steve Savant on February 25, 2013
Steve Savant

Steve Savant

Scottsdale , AZ

Joined: January 28, 2005

The ESOP is essentially a stock bonus plan in which employer stock may be used for contributions. The employer contributes company stock or cash to the plan, and the contributions are tax-deductible. Contributions are not taxed currently to the employee. Earnings accumulate income tax-deferred. Distributions are generally taxed as ordinary income. Distributions may be eligible for 10-year income averaging. Or, at retirement from the current employer, distributions may be rolled over to a traditional or a Roth IRA, or to another employer plan if that plan will accept such a rollover. Steve and Keriti lay out the essentials as they introduce ESOPs into your practice.

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