Employee Stock Ownership Plans

Design Your Own ESOP With MGKS

MGKS has been servicing employee stock ownership plans for decades and we take pride in our ability to do so as most TPA firms do not offer this service. Whether you are trying to raise capital, or transition ownership to your employees, MGKS can help qualify you for the different types of ESOPs, and design a plan around your specific circumstances.

  • Succession Planning
  • Corporate Financing Objectives
  • Employee Relations Objectives
  • Pre-Tax Buyout Structures
  • Sell At Your Own Pace

We will work with you and your advisors to design a plan that has your best interests in mind. Being that these plans are flexible and can be structured in many different ways, working with a TPA to design a plan that targets your specific circumstance is crucial.

Company Benefits

(Plan Sponsor)

At MGKS we undertand the multiple different options that are available for companies sponsoring an ESOP. They are a great way to raise capital for ongoing operations, and offer an alternatives for succession planning when a departing owner does not wish to sell to a third party. AT MGKS we will help quide you through the various options so you can make an educated decision as to which plan design fits your agenda.

Sheltering Taxable Income:

  • When the company contributes cash to the ESOP to repay the loan, it results in a tax deduction.

    Succession Planning:

    • Allows ownership to be transferred to employees using corporate profits rather than the employees after tax income, and can be done as quickly or as slowly as the owners desire.

      Preserve Your Legacy:

      • Selling to a third party often means the new owner will restructure and sometimes downsize your employees. They could even move the business to another location or out of state. By transitioning ownership to your employees rather than a third party, you ensure the corporate culture, employment practices, and overall work environment developed through the years remains constant even after the sale.

        Employee Incentives

        • When your employees become owners, they have more skin in the game. The transition of ownership internally generally results in increased productivity and a real sense of ownership. These employees tend to work harder as their retirement outcome is now directly tied to how well the business does after the current owner retires.

          Employee Benefits

          ESOPs give your company a way to compensate employees with equity rather than cash bonuses or raises. Even if the current owner is not ready to retire, they can contribute tax deductible shares of their own stock to the plan then gradually transition ownership to the employees when they are ready.

          Employee Benefits:

          • A properly designed ESOP can yield valuable and lasting results which create loyal, productive and grateful employees.

            Add Employee Engagement:

            • Employees work harder and have a higher sense of self-worth.