e57
Senior Member
- Location
- San Francisco, CA
Anyone in one? Work out for you? Risks?
Owners are thinking about it.....
Owners are thinking about it.....
Esop
- Thread starter e57
- Start date
- Status
ultramegabob
Senior Member
- Location
- Indiana
Employee Stock Ownership Plan?
billsnuff
Senior Member
- Location
- East of 480sparky
employee stock ownershop program
employee stock ownershop program
you will have to decide for yourself........in '99 our employees bought the company to keep from being closed. cost me 19% in wages upfront. term was 7 years. let's say that 19% = 10,000.00. after seven years we merged with another company. esop closed and i got 20,000. lost my tail but we are still open and working and are expanding. also included a provision for profit sharing. we turned a profit in 2 of 28 quarters after EBITDA. (earnings before interest, taxes, depreciation & amortization).
can be a great deal or a bust. EVERYONE MUST understand there impact on the bottom line and do everything within the area of responsibility to have a positive impact.
employee stock ownershop program
you will have to decide for yourself........in '99 our employees bought the company to keep from being closed. cost me 19% in wages upfront. term was 7 years. let's say that 19% = 10,000.00. after seven years we merged with another company. esop closed and i got 20,000. lost my tail but we are still open and working and are expanding. also included a provision for profit sharing. we turned a profit in 2 of 28 quarters after EBITDA. (earnings before interest, taxes, depreciation & amortization).
can be a great deal or a bust. EVERYONE MUST understand there impact on the bottom line and do everything within the area of responsibility to have a positive impact.
- Location
- Windsor, CO NEC: 2017
- Occupation
- Service Manager
jimmyglen
Senior Member
- Location
- St. Louis, Missouri
what size company is this?
if its a small compnay - its sounds fishy
this is a cut and paste form a yahoo seach
Caveats
As attractive as these tax benefits are, however, there are limits and drawbacks. The law does not allow ESOPs to be used in partnerships and most professional corporations. ESOPs can be used in S corporations, but do not qualify for the rollover treatment discussed aboved and have lower contribution limits. Private companies must repurchase shares of departing employees, and this can become a major expense.
The cost of setting up an ESOP is also substantial -- perhaps $30,000 for the simplest of plans in small companies and on up from there. Any time new shares are issued, the stock of existing owners is diluted.
That dilution must be weighed against the tax and motivation benefits an ESOP can provide. Finally, ESOPs will improve corporate performance only if combined with opportunities for employees to participate in decisions affecting their work.
if its a small compnay - its sounds fishy
this is a cut and paste form a yahoo seach
Caveats
As attractive as these tax benefits are, however, there are limits and drawbacks. The law does not allow ESOPs to be used in partnerships and most professional corporations. ESOPs can be used in S corporations, but do not qualify for the rollover treatment discussed aboved and have lower contribution limits. Private companies must repurchase shares of departing employees, and this can become a major expense.
The cost of setting up an ESOP is also substantial -- perhaps $30,000 for the simplest of plans in small companies and on up from there. Any time new shares are issued, the stock of existing owners is diluted.
That dilution must be weighed against the tax and motivation benefits an ESOP can provide. Finally, ESOPs will improve corporate performance only if combined with opportunities for employees to participate in decisions affecting their work.
billsnuff
Senior Member
- Location
- East of 480sparky
top 100 ESOPs
top 100 ESOPs
http://www.nceo.org/library/eo100.html
national center employee ownership FWIW
top 100 ESOPs
http://www.nceo.org/library/eo100.html
national center employee ownership FWIW
Jhaney
Senior Member
- Location
- owensboro, ky
Just a quick food for thought. I learned the hard way not to double invest in the company you work for. What I mean is don't buy any significant amout of stock in the company you work for because in the off chance the company fails you then fail twice. Once when the stock becomes worthless and second when they lay you off. I learned this the hard way working for adelphia, not only was I laid off but I lost not only my shirt but my pants, shoes and socks when the price of the stock tanked overnight.
dduffee260
Senior Member
- Location
- Texas
You have to watch ESOP's because the rules are so gray. I once had a " retirement account" with my former boss. One year it was over $40,000. The next year it dropped to $24,000. They told me and I quote " it was money that was not really there to begin with". I told them it had to be there because that was what the number was at one time. After that I knew I did not want to work for that company anymore and I soon left. Bythe time I got my money a year later it was $11,000. Someone retired allright and it was not me.
- Status