Legislation seeks bolstered retirement savings initiative

A group of lawmakers have introduced a bill that would encourage retirement savings by bolstering the growth of S corporations owned by Employee Stock Ownership Plans (S-ESOP).

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U.S. Sens. Steve Daines (R-MT) and Ben Cardin (D-MD), both members of the Senate Finance Committee, recently joined 20 colleagues to detail the expanded version of the Promotion and Expansion of Private Employee Ownership Act.

“While Montana workers and businesses struggle to navigate this challenging economy, it’s important we strengthen creative ways to help folks grow their wealth and reach financial security,” Daines said. “ESOPs help expand ownership of the economy to middle class Montanans and make it easier for folks to invest toward a comfortable retirement.”

Bill proponents indicated the measure includes provisions incentivizing owners of S Corporations to sell their stock to an ESOP by providing deferral treatment for contributions of S Corporation stock to an ESOP, so long as certain reinvestment requirements are met; provides technical assistance for companies that may be interested in forming an S-ESOP; ensures small businesses that become ESOPs retain their SBA certification; and affirms the importance of preserving the S-ESOP structure in the Internal Revenue Code.

“America is the land of opportunity, and our bipartisan bill will help protect and preserve the American dream for Montanans from all walks of life,” Daines said.