The One-Stop ESOP Blog | Your Resource For All Things ESOP

Check out the 2027 ESOP and Pension Plan Limits

Aaron Juckett, CPA, CPC, QPA, QKA — Fri, 13 Nov 2026 20:11:59 GMT

The IRS has announced the 2027 pension plan limits, which include the following:

Ownership Is A Behavior, Not A Title: Building An Esop Ownership Mindset

Jason Wellman — Tue, 10 Nov 2026 14:15:00 GMT

Six months after the ESOP transaction celebration, the room has gone quiet.

The leadership team expected gratitude and fresh energy. Instead they get polite nods as employees ask themselves this question: what does ownership actually mean for me?

If you lead people through an ESOP transformation, that silence is one of the most telling signals you’ll get, and it can be easy to misread. I’ve spent almost 10 years helping employee-owned companies build an ownership mindset, and the pattern holds across nearly all of them.

The ESOP transaction makes employees’ beneficial ownership official. But it’s not what it takes to make any one of them feel like an owner. That feeling gets built, slowly, on what leaders do after the deal closes.

Esop, Strategic Sale, Or Private Equity: What The Multiple Doesn’t Tell You

Eric Strebe, Director of Business Consulting — Wed, 14 Oct 2026 15:00:45 GMT

I sometimes sit down with owners who’ve already decided the private equity offer is the real number and an ESOP sale is a consolation prize. The purchase price on the private equity term sheet is often bigger, so the decision feels made before the conversation starts.

I understand the instinct. I also think it’s the wrong way to run an ESOP vs. private equity comparison.

My team and I take business owners through the process of selling their companies to their employees, from the first informational conversation to sitting beside them as their trusted sell-side advisor at closing. From that seat, we see a consistent pattern: the headline multiple isn’t the only important factor in determining what your company sale will net. Once you account for how the sale is taxed, what the deal terms end up paying out, and who runs the company the morning after the sale closes, an ESOP is frequently competitive with a private equity or strategic sale.

Sometimes it comes out ahead. Here is how I walk owners through the comparison.

ESOP TPA Red Flags: When It's Time to Switch Administrators

Kelly Jansen — Thu, 10 Sep 2026 14:46:27 GMT

You already know something is off: A report came back wrong again. A question you asked two weeks ago is still sitting unanswered. There’s a new name on the email again, and you’re explaining your plan from scratch for the third time. None of these is a fireable offense on its own, so you keep waiting, wondering whether you’re being unreasonable.

You’re not. After two decades administering ESOPs, I can tell you that almost no company leaves a third-party administrator over a single missed deadline. They leave because the relationship went almost silent, reactive, and impersonal, and they spent months, sometimes years, unsure whether the problem was them or the TPA. Here’s what I’ve seen about what really signals a relationship worth leaving, and why switching is rarely as painful as staying.

How ESOP Shares Are Allocated: A Guide for Company Leaders

Aaron Juckett, CPA, CPC, QPA, QKA — Tue, 10 Feb 2026 14:37:46 GMT

TL;DR

ESOP shares are allocated each year using a set formula, usually based on compensation, and must comply with ERISA and IRS rules:

Eligibility has two stages: employees first become participants by meeting age, hours, and service requirements on scheduled entry dates; then receive allocations by working 1,000+ hours and remaining employed at year-end
Vesting determines ownership: employees keep only the vested portion if they leave; unvested shares are forfeited and reallocated
In a leveraged ESOP, shares start in a suspense account and are released annually as the loan is repaid
Allocation influences repurchase obligations and long-term ESOP sustainability

Defer Capital Gains Tax on ESOP Sales

Eric Strebe, Director of Business Consulting — Tue, 13 Jan 2026 14:32:53 GMT

TL;DR

A Section 1042 exchange lets eligible C-corp owners who sell to an ESOP defer capital gains by reinvesting in Qualified Replacement Property, but the benefit only holds if they meet strict eligibility rules, timelines, and QRP requirements:

Seller must meet §1042 criteria: C-corp stock, 3-year holding period, and ESOP must own ≥30% post-sale
Tax deferral applies only to proceeds reinvested in QRP during the 15-month replacement period
QRP must be securities of U.S. operating companies; not mutual funds, ETFs, REITs, or government/municipal bonds
Violating anti-allocation rules or missing deadlines can void the tax benefit
When executed properly with professional tax, legal, and investment guidance, a 1042 exchange can significantly enhance the seller’s after-tax outcome and support long-term financial planning

The Built-In Gains Tax for S Corporations with ESOPs

Eric Strebe, Director of Business Consulting — Tue, 02 Dec 2025 17:59:06 GMT

When a C corporation becomes an S corporation, appreciation that accrued pre-conversion can still be taxed at the corporate level if realized during the five-year recognition period.

For ESOP-owned S corps, the BIG tax is entity-level — it does not flow through to shareholders — and it can meaningfully affect transaction timing, repurchase planning, and exit strategy.

In this article, we break down what triggers BIG, how it’s calculated, and how your CPA and tax team are key to the decision-making process and timeline for a C- to S-corporation conversion.

Check out the 2026 ESOP and Pension Plan Limits

Aaron Juckett, CPA, CPC, QPA, QKA — Fri, 14 Nov 2025 14:51:45 GMT

The IRS has announced the 2026 pension plan limits, which include the following:

How to Convert a C Corp to an S Corp: Key Steps & ESOP Insights

Eric Strebe, Director of Business Consulting — Tue, 11 Nov 2025 15:01:16 GMT

Converting from a C corporation to an S corporation can reduce double taxation and, for ESOP-owned companies, unlock powerful pass-through advantages, but it’s not a “one-click” move, and both the decision and the process can be complex.

Timing, eligibility, the five-year built-in gains (BIG) window, and 409(p) testing all matter. The right answer depends on your ESOP ownership percentage, your transaction roadmap, and your goals — which is why we start with a feasibility study and coordinate closely with your CPA, ERISA counsel, and trusted business advisors.

In this article, we walk through the conversion steps, key technical considerations, and ESOP-centric issues you must address.

DOL’s New Lost & Found Database: What’s True & What’s Hype?

Bryan Boeck — Tue, 07 Oct 2025 13:15:00 GMT

In late 2024, the U.S. Department of Labor (DOL) launched its long-anticipated Retirement Savings Lost and Found Database, a searchable tool designed to help participants track down retirement accounts they may have lost along the way.

The database was authorized under ERISA Section 523, as amended by SECURE 2.0 Section 303, making it a congressionally mandated initiative rather than just a DOL policy decision. On its face, the idea is simple: make it easier for retirees to reconnect with forgotten 401(k), pension, or employee stock ownership plan (ESOP) balances.

While the concept of a centralized database sounds like a simple solution, in practice, it does little to address the root causes of missing participants.

For employers, the real takeaway isn’t the lost and found itself, but the need to double down on sound plan administration: updating records, improving communication, and reducing the chance that accounts go missing in the first place.