Retire through Ownership Act
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Progress
Where this bill stands in the legislative process.
- Introduced
- Passed House
- Passed Senate
- To President
- Became Law
Overview
This bill clarifies how Employee Stock Ownership Plans (ESOPs) determine the value of their stock. Specifically, it allows the ESOP’s fiduciary to trust a valuation from an independent appraiser if the stock isn’t publicly traded and the appraiser follows established guidelines. ESOPs are retirement plans where employees own shares of their employer’s stock. The bill aims to provide more certainty in valuing these types of investments.
Key provisions
- Allows ESOP fiduciaries to rely on valuations from independent appraisers.
- Specifies that these valuations must adhere to the principles and methodologies outlined in IRS Revenue Ruling 59-60.
- Applies to stock that is not traded on a national securities exchange (i.e., not publicly traded).
- Defines ‘adequate consideration’ for closely held stock within ESOPs.
- Redesignates and rewords section 3(18) of ERISA to reflect these changes.
- Establishes an effective date for the changes.
Who is affected
- Employee Stock Ownership Plan (ESOP) participants and beneficiaries
- ESOP fiduciaries
- Employers with ESOPs
- Financial appraisers and valuation experts
- Retirement plan administrators
Notable changes
- Provides a specific framework for valuing non-publicly traded ESOP stock.
Bill text
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Sponsors
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5 on record
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Cosponsors
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