As part of the Economic Growth and Tax Relief Reconciliation Act of 2001 (EGTRRA), very complex S corporation ESOP anti-abuse provisions were enacted into the Internal Revenue Code in the form of new Code section 409(p).
The purpose of the ...
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Resources
The Strategic Advantage (and Compliance Risks) of S Corporation ESOPs
Employee stock ownership plans (ESOPs) have long been a powerful planning tool. For S corporations, they offer unique tax benefits — and unique pitfalls.
If you're a closely held S corporation evaluating a succession plan, shareholder liquidity ...
[Read more] about The Strategic Advantage (and Compliance Risks) of S Corporation ESOPs
Controlled Group or Affiliated Service Group? What That Means for Your 401(k) Plan Compliance
If you’ve recently discovered your business may be part of a Controlled Group (CG) or an Affiliated Service Group (ASG)—or assumed you weren’t and got it wrong—your 401(k) plan could face significant compliance issues.
This misstep isn’t just a ...
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Selling an ESOP Company
You are the CEO of a very successful, 100% ESOP owned S corporation. The company is profitable and running very well, paying no federal or state income taxes. The employees are happy. Out of the blue, you get an offer from a third ...
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Form 5500: The Role of the Accountant and the Audit Report
What is an accountant's role in your annual return/report (Form 5500)? Conventional wisdom says that accountants or auditors have an integral role to play in the preparation of the annual report for employee benefit plans, from both a financial and a ...
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The Top 5 “Speed Bumps” When Terminating an ESOP
When terminating a qualified retirement plan, there are undeniably many details. Once the termination and wind up of the trust process begins, questions, loose ends and other “speed bumps” can slow down the process considerably. In this article, we ...
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Confused by the terminology? Check our Glossary of Terms