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STRATEGY #3:
Establish an Employer Strategic Tax Benefit Plan
SUMMARY DESCRIPTION
As a future strategy we recommend establishing an E.S.T.B. (Employer Strategic Tax Benefit Plan). In 1997 Congress approved the
use of a tax-exempt entity known as an E.S.O.T. (Employee Stock Ownership Trust). Congress' intention is to allow business owners to
create access to tax savings generated through the ESOT structure. This is the only advanced strategy in the marketplace that allows
immediate access to tax savings without triggering a tax. Plus, it creates a performance-based employee benefit without giving up control
of Meade Young, LLC. We can aggregate other similar businesses to meet 11 employee requirements for this strategy.
Assuming all of the ESOT requirements are met, we recommend establishing an S corporation owned by the ESOT to provide
administrative and management services to Meade Law LLC and/or your other business entities. The administrative services fee is a tax-
deductible payment to the ESOT.
Once the new S-Corporation ("Admin Entity") is set up, the owners will control and maintain the entity as board members. We
also will create customized management contracts between your companies and the Admin Entity. These contracts and the services
provided on behalf of Meade Law(and affiliated entities) describe what services are provided. No daily administrative duties are changed
with this enhanced structure.
Lastly, as owners of Meade Law, you will have access to the funds (and tax savings) for other purposes as well, such as
purchasing competitors, create short and long-term financing funds thereby reducing reliance on Lines of Credit, real estate when limited
by bonus depreciation, fund key-employee benefts to name a few benefits.
Please refer the following pages for a Graphic Overview and Tax/Financial Analysis of Strategy #3.