Can You Limit ERISA/Pension Fund Withdrawal Liability?

It’s no secret that pension plans around the country are in trouble. The financial crisis of recent years has not only affected the value of securities and other investments, but has contributed to the failure of key businesses, and has caused many pension plans to become underfunded. What may come as a surprise to contributing …

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ESOP Appraisers Will Not be Named as Fiduciaries…At Least for the Time Being

It was reported in January 2015 that the Department of Labor (DOL) will abandon the “appraiser-as-fiduciary” rule from its planned re-proposal of a broad set of rules affecting fiduciaries and prohibited transactions. This story goes back to 2010 when the DOL issued a proposed regulation that would impose a fiduciary obligation on business appraisers in …

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The DOL Comes Down Hard on ESOP Trustee

On June 2, 2014 the U.S. Department of Labor (DOL) reached a $5.25 million settlement with GreatBanc Trust Company (GreatBanc). It was alleged that GreatBanc, as trustee to the Sierra Aluminum Company Employee Stock Ownership Plan (ESOP), allowed the plan to purchase stock from Sierra Aluminum’s co-founders and top executives for more than fair market …

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Succession Planning With an ESOP

There are many ways for a business owner to successfully plan for his/her exit.  A survey conducted by the Business Enterprise Institute, Inc. shows the break down by successor type as follows:                 The largest allocation of 41% is to key employee(s), a co-owner, or an employee stock …

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Thinking About A Leveraged ESOP Transaction? Part II

With proper planning and execution, a leveraged ESOP can provide benefits to all parties of the transaction, including the company, the owners, the employees and lenders. The Company The most significant benefit for the company is the tax deduction for the contributions to the ESOP, which are essentially returned to the company and available to …

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