August 18, 2008 (Washington, DC) – On August 15, 2008, The ESOP Association submitted comments to the Internal Revenue Service (IRS) concerning Sample Plan Language for Section 409(p) Transfers. Section 409(p) ensures that an S ESOP arrangement is a broad-based employee ownership plan. The comments asked the IRS to make clear that the sample language represents a permitted approach to correction but is neither mandatory nor the exclusive method for preventing a possible violation of the complex provisions of 409(p). The ESOP Association comments included language changes that would expand the situation to which the preventative approach could apply.
“The ESOP Association is pleased to work with the IRS,” said J. Michael Keeling, President of The ESOP Association. “Our goal is to ensure the laws governing ESOPs are implemented in accordance with Congressional intent to broaden ownership in our nation and to so as effectively as possible for our members.”
A copy of the comments can be found on the Association’s website at www.esopassociation.org.
The core cause of The ESOP Association is the belief that employee ownership will improve American competitiveness, increase productivity through greater employee participation, and strengthen our free enterprise economy.
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To view a copy of the comments, click here.