Dec 22, 2021 10:02:13 AM
Internal Revenue Code Section 401(a)(28) allows employees to diversify a portion of their stock once they meet certain eligibility requirements. There are specific age and service requirements outlined by the IRS to determine who is a Qualified Participant, however your plan may allow for rules that are less restrictive.
Topics: Diversification, Plan Document
Mar 10, 2021 10:15:00 AM
Topics: ESOP Communications, Diversification
Mar 27, 2019 3:15:04 PM
As your ESOP matures, you may feel that you and your employees are starting to better understand your plan provisions and the benefits an ESOP provides. It is important for participants to feel engaged and knowledgeable about their plan. One item that can be difficult to communicate to your employees and comes later in the ESOP’s development is diversification. Your participants will want to know when they can diversify, how much they can diversify, and what their diversification withdrawal options are.
Topics: Plan Design, Diversification
Aug 16, 2017 12:39:47 PM
Topics: Distributions, Dividend Rules, Diversification, Conferences
Jul 25, 2017 4:24:42 PM
Topics: Distributions, Dividend Rules, Diversification, Conferences
Jul 14, 2017 2:52:47 PM
Find the information, ideas, and advice you need to make better ESOP decisions at The Fall ESOP Forum in Tampa, FL, this October 3-4, 2017. Both experienced attendees and newcomers will leave the Fall ESOP Forum better informed and better prepared to evaluate and implement the next steps for their companies.
Blue Ridge ESOP Associates is proud to be sponsoring this conference with Renee Stadtmueller presenting in the following session.
“ESOP Distribution and Diversification Practices”
Distribution rules have more flexibility than many people think, and finding the right approach can help you make your plan more sustainable
Tuesday, October 3 - 9:30-10:15 a.m.
Renee is a Director at Blue Ridge ESOP Associates. She has more than 19 years of experience providing administration and consulting advice to ESOP clients. She is a CPA and holds the QPA designation from ASPPA. She works closely with plan sponsors, accountants, advisors and legal counsel to provide guidance on plan design, compliance and operation. She is a member of the NCEO, The ESOP Association, and ASPPA. She has served as a chairperson for ASPPA's Education and Examination ESOP Certificate Subcommittee and as the vice president of programming for the Wisconsin Chapter of The ESOP Association. Renee received her bachelor of business administration in accounting and finance from the University of Wisconsin-Oshkosh.
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Topics: Distributions, Diversification, Conferences
Feb 10, 2017 3:21:38 PM
For ESOPs whose stock isn’t publicly traded, the timing rules for diversification have historically been difficult to meet. The law says the plan has to issue notices to participants who are eligible for a diversification within 90 days after the close of the plan year. For those electing a diversification, the plan has until 180 days from the close of the prior plan year to make the payment. Many ESOPs are not able to get the stock appraisal and annual work done in the 90 or 180 days to comply with the law. The industry best practice has always been to issue a preliminary notice within the 90 day window informing a diversification eligible participant of their right to diversify. After the annual work was done, plans would then issue the actual diversification notice and make the payments as soon as feasible thereafter.
Topics: IRS, Diversification
