Employee Stock Ownership Plans

There has been a dramatic growth in the popularity of ESOPs during the past decade. Owners of closely-held design firms can realize many advantages with an ESOP, including:

  • Improved Employee Morale
  • Tax Deductible Shareholder Buy-Outs
  • Estate Tax Planning Opportunities
  • Income Tax Deferral Opportunities
  • Favorable Financing
  • A Market for the Firm's Stock
  • Increased Employee Productivity

The valuation the firm's stock is a critical element in a successful ESOP because trustees cannot pay more than fair market value for the firm's stock. An ESOP valuation should be prepared by a qualified, independent appraiser, as required by Federal law, an updated at least annually.