ESOP

ESOP is an employee stock ownership plan and is a tax qualified defined contribution plan. The employer establishes an ESOP trust to primarily hold stock and cash to purchase stock in the company. The company then purchases its own stock and then allocates it to the employee’s in their own individual accounts. The amount allocated to an individual employee is generally based upon the salary level of that employee. It is important to note that the employee’s interest in their account is subject to vesting rules and they may not be entitled to all the money in their account at the time of a dissolution of marriage or legal separation. Vesting issues are a very important consideration when a qualified domestic relations order is to be entered in order to divide the ESOP benefits. Please contact The Harrian Law Firm, P.L.C. if you need any assistance in dividing your ESOP benefits.