Plan Document
The employee must complete the following two (2) Plan provisions:
•Attainment of age 21
•1 hour of service (hire date)
Once these two (2) Plan provisions are completed the employee-owner enters (daily) the ESOP plan.
An ESOP is defined as... (blank) Plan?
An ESOP is a defined contribution plan, a form of retirement plan as defined by 4975(e)(7) of IRS codes. ESOPs became a qualified retirement plan in 1974.
In total, there are approximately (blank) ESOPs in the United States?
6,467 ESOPs
What is the number one hurdle for most committees?
Time
Who is the current Plan Trustee for Lushin and Associates, Inc. Employee Stock Ownership Plan?
Kjersti Cory
You are eligible to receive an allocation for each Plan Year you:
•Actively employed on the last day of the Plan Year (December 31st)
An ESOP is governed by what law that passed in 1974?
Employee Retirement Income Security Act (ERISA)
Internal Revenue Code section 404(a)(3) provides for an annual limit on the number of deductible contributions an employer can make to a tax-qualified stock bonus or profit-sharing plan of 25% of the compensation otherwise paid or accrued during the year to the employees who benefit under the plan.
Employees at ESOP companies have (blank times) greater retirement account?
2.5x
Name one of the basic elements of a committee charter document?
•Mission Statement
•Eligibility Requirements
•Length of Membership
•Frequency and Length of Meetings
•Expectations
•Committee Chair
•Committee Members
Who is your independent valuation firm?
ESI Equity
There are five (5) events that can trigger a distribution from the Plan:
1.Retirement:
•Normal (age 65)
2.Death
3.Disability
4.Termination (voluntary or involuntary)
5.Diversification (minimum age 55 with 10 years of participation in the ESOP Plan)
*The opportunity for an eligible plan participant to diversify their ESOP account won’t happen until plan year 2032.
What is the maximum contribution an employer can make to an ESOP if the company’s total compensation was $10,221,196.20?
$2,555,299.05
Approximately, how many 100% ESOP exist throughout the USA?
2,500
Name one of the five critical steps in the annual process for developing and maintaining an effective committee:
1.Strategic Planning
2.Committee Overview
3.Application Process
4.Education and Development
5.Execution of the Strategic Plan
In 1974 Louis Kelso and Senator Russell Long helped pass what law?
ERISA Law - it governs and provides guidelines to this day on ESOPs.
If you're not 59 1/2 and you take a distribution from your ESOP Participant account, you'll be hit with what percentage penalty from the IRS?
10%
* Best practice – speak with a financial advisor whenever electing a distribution from your account.
What is the name of the first ESOP that Louis Kelso invented back in 1956?
Peninsula Newspapers, located in Norther California
How many Employee-Owned Companies are located in the State of Indiana?
The great state of Indiana has 172 Employee-Owned Companies.
The announcement of the committee or re-announcement of the committee’s existence for all employee owners should highlight what?
Employee-owners are empowered and tasked with improving workflow, creating efficiencies, and so much more to drive the overall enterprise value.
What is the effective date of Lushin and Associates, Inc.'s ESOP?
January 01, 2022
When you leave the company, how many shares are you able to leave with?
Trick question, you'll never leave the company with ESOP shares. You'll always be paid out in the form of cash/check.
On December 22, 2022 Congressed passed what law?
Secure 2.0 Act of 2022, which includes the Consolidation Appropriation Act, 2023. This retirement security legislation, which passed the House and two key Senate committees with a, bipartisan support, included several critical provisions that we’ve sought for a long time, and which are vital to promoting employee ownership.
What is the average ESOP account balance for an Employee-Owner in the State of Indiana?
The average ESOP account balance of an Employee-Owner in the State of Indiana is $116,524.42.
Who should apply to be on the ESOP ownership committee?
Anyone interested in helping solve organizational problems, creating efficiencies, and growing their skillset and service within the company
What is the name of your TPA or record keeper for your ESOP?
ESOP Partners, Inc. - located in Appleton, WI.