WASHINGTON, D.C. – In response to the Missouri General Assembly’s passage of House Bill (HB) 2030, the Stock Ownership Deduction Tax Act, Employee-owned S Corporations of America (ESCA) Executive Director Stephanie Silverman released the following statement:
“Supporting more employee-ownership is a great step for Missouri, promising to improve workers’ financial well-being, strengthen companies and local economies, and drive growth across the state. We thank Rep. Denny Hoskins, Sen. Ryan Silvey, and the Missouri lawmakers who fought to support this legislation and ensure that more hardworking Missourians will have an ownership stake in their companies and the prospect of a retirement with dignity.”
Employee stock ownership plans (ESOPs) are a proven economic model for strengthening retirement security as well as reducing wealth and wage inequality. As Missouri has 31,000 business owners over the age of 55 nearing retirement, this is an important window of opportunity to increase employee ownership in the years ahead.
“A recent study by the National Center for Employee Ownership and ESCA found over 100,000 ESOP participants in Missouri; HB 2030 offers support to build upon the model’s success across the state and protect more Missourians and their families. The benefits of this vote will be felt for decades to come,” continued Silverman.
Details About HB 2030
HB 2030 allows business owners to defer up to 50 percent of the taxes gained from the sale of stock to an ESOP as long as the company is over 30 percent employee-owned. The bill is similar to ESOP incentive legislation passed in other states, including the state of Iowa. This deduction will incentivize more business owners to turn their companies over to their employees. The bill passed the Missouri House of Representatives in May, was vetoed by Governor Nixon in June, and overridden to become law by Missouri lawmakers in September.
More information on ESOPs is available here.