subject: Take Care Of Your Employees With An Esop [print this page] Many business owners have many different things on their plates. One of the most pressing things on their plate is employees. If they get great employees then they can have confidence that their business is in good hands and that the employees will take care of your customers and the work that they do will be the best that their employees have to give. It is always great to get great employees, but the greater challenge is keeping the employees. As an employer, if you don't take care of your employees the employees will eventually burn out or start to look for other jobs. They won't give your company their all.
As an employer you might consider annual bonuses or different incentives, but one of the best ways to keep your employees committed to your company and continue to have an interest in helping your company make a profit is by doing an ESOP program. You might be wondering what that is. An ESOP program is short for Employee Stock Ownership Plan.
With an ESOP there are several different benefits for both you and the employee. For the owner it is a benefit because you can offer a portion of your business of liquid stock to your employees. That means that an ESOP becomes a retirement benefit for your employees. Many employees don't even have a savings let alone a future with a retirement plan. The other nice part with an ESOP is that the taxes on the employee portion is deferred and the employee doesn't have to pay anything out of pocket at the time of the ESOP being given to them.
With this investment in your employees and for them to have a part of your company they will become invested in the company because they will want to see the company successful to help their retirement plan. This becomes a win-win for both the employee and the employer.
Another benefit for the employer is that it becomes a tax benefit for the company. With an ESOP the tax benefits for the company include being able to deduct the entire contribution. When the entire contribution is referred to that means that not only can the principal be deducted, but also the interest. That means that the ESOP can become tax-deductible for the company.
This is something that can only be offered if the company is profitable and the company has something to give to the employees. The ESOP option is definitely something to look into as an option to continue to take care of your employees.
