Employee Stock Ownership Plan


ESOP. A trust established by a corporate which acts as a tax-qualified, defined-contribution retirement plan by making the corporation's employees partial owners. contributions are made by the sponsoring employer, and can grow tax-deferred, just as with an IRA or 401(k) plan. But unlike other retirement plans, the contributions must be invested in the company's stock. The benefits for the company include increased cash flow, tax savings, and increased productivity from highly motivated workers. The main benefit for the employees is the ability to share in the company's success.
Due to the tax benefits, the administration of ESOPs is regulated, and numerous restrictions apply. also called stock purchase plan.

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You may want to offer an employee stock ownership plan as a way to motivate your workers to do right by you.

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He got an employee stock ownership plan and I was really happy with it and thought he would be very happy with it.

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John was so excited about the employee stock ownership plan offered at his company. He felt this was an easy way to accumulate stock in the company.

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