|
|
Like this article? PLEASE +1 it! |
|
Employee Trusts
Written by: Start Your BusinessArticle Overview: The objective of this program is to provide financial assistance to Employee Stock Ownership Plans. The employee trust must be part of a plan sponsored by the employer company and qualified under regulations set by either the Internal Revenue Service Code (as an Employee Stock Ownership Plan or ESOP) or the Department of Labor (the Employee Retirement Income Security Act or ERISA). Applicants covered by the ERISA regulations must also secure an exemption from the Department of Labor regulations prohibiting certain loan transactions.
![]() |
Free Download - Lease Equipment By Start Your Business |
Employee Trusts
The objective of this program is to provide financial assistance to Employee Stock Ownership Plans. The employee trust must be part of a plan sponsored by the employer company and qualified under regulations set by either the Internal Revenue Service Code (as an Employee Stock Ownership Plan or ESOP) or the Department of Labor (the Employee Retirement Income Security Act or ERISA). Applicants covered by the ERISA regulations must also secure an exemption from the Department of Labor regulations prohibiting certain loan transactions.
Loan Amounts Available for Qualified Employee Trusts Loans
Effective December 22, 2000, a maximum loan amount of $2 million has been established for 7(a) loans. However, the maximum dollar amount the SBA can guaranty is generally $1 million. Small loans carry a maximum guaranty of 85 percent. Loans are considered small if the gross loan amount is $150,000 or less. For loans greater than $150,000, the maximum guaranty is 75 percent.
Who is Eligible for a Qualified Employee Trusts Loan?
SBA can assist qualified employee trusts that meet the requirements and conditions for an Employee Stock Ownership Plan (ESOP) as prescribed in all applicable IRS, Treasury, and Department of Labor regulations. The small business must provide all the funds needed to collaterize and repay the loan. A qualified employee trust may:
* re-lend proceeds to the employer by purchasing qualified employer securities, or
* purchase a controlling interest in the employer.
SBA Loan Maturities
Interest Rates
Fees
Guaranty Percent
Article Tags:
|
About the Author: Start Your Business RSS for Start Your's articles - Visit Start Your's website Starting a business requires you to complete a number of steps and make some key decisions. Though part of your overall plan, you’ll need to select a location, decide on a business structure, and obtain the necessary licenses and permits. In addition, determining which financing options will meet your short-term needs and long-term goals is crucial. Within this section, we’ll provide information on these topics along with guidance on buying an existing business, copyright and trademark issues, and getting support from an outside expert. Click here to visit Start Your's website Finance StartUp State Requirements The Benefits of Making Your Banker Your Friend Sales Agreement Basic Structures |
Related Forum Posts
Share this article with your friends. Fund someone's dream.
Leave a comment below or share on the left and you'll help support entrepreneurs in Africa through our partnership with Kiva. Over $50,000 raised and counting - Please keep sharing! Learn more.
Get advice & tips from famous business
owners, new articles by entrepreneur
experts, my latest website updates, &
special sneak peaks at what's to come!
Civility in the Workplace---Is it Decreasing?
Top 5 Tips for Better Online Ads
Ten Things You Can Do To Be a Better Leader
Email us your ideas on how to make our
website more valuable! Thank you Sharon
from Toronto Salsa Lessons / Classes for
your suggestions to make the newsletter
look like the website and profile younger
entrepreneurs like Jennifer Lopez.



