Employee Stock Ownership Plans (ESOPs) are becoming a popular—and tax effective—way for companies to manage succession planning. When structured properly an ESOP can provide huge financial benefits to companies and their employees alike. There have been several craft brewers who have taken advantage of the ESOP structure in the past year, and we expect this trend to pique the interest of craft distilleries. In this article, originally published in Artisan Spirit, Marc E. Sorini and Emily Rickard explore at a very high level some of the issues involved with starting and maintaining a craft distillery ESOP.
ESOPs and Artisan Distilling
By Marc Sorini and Emily Rickard on July 6, 2017
Tags: Alcohol & Tobacco Tax, American Craft Spirits Association, Code Section 1042, Employee Retirement Income Security Act of 1974 (ERISA), Employee Stock Ownership Plans (ESOP), fiduciary duties, Internal Revenue Code of 1986, Internal Revenue Service (IRS), National Center for Employee Ownership, New York Times, Prohibited Transactions, The Atlantic, Trade Bureau, US Department of Labor (DOL)
Marc SoriniMarc E. Sorini concentrates on issues facing the alcohol beverage industry, with a particular focus on the supplier tier and non-beverage alcohol users. He heads the Firm's Alcohol Regulatory & Distribution Group and is recognized as one of the leading lawyers in his field. Read Marc Sorini's full bio.
Emily RickardEmily Rickard focuses her practice on executive compensation and employee benefits, and has devoted a substantial portion of her practice to assisting employers in implementing and maintaining employee stock ownership plans (ESOPs). She has represented companies, inside ESOP trustees, and outside ESOP trustees in buy-side and sell-side transactions, as well as in ongoing ESOP compliance matters. Read Emily Rickard's full bio.
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