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Showing articles tagged "Employee Stock Ownership Plan" (clear)
Updated October 28, 2026
Selling to an ESOP: ERISA's "Adequate Consideration" Requirement
How employer stock must be valued when an ESOP buys it, and what the Retire through Ownership Act changed
An ESOP lets the owner of a closely held business sell the company to its employees through a retirement trust — but because the plan buys stock from insiders, ERISA permits the purchase only for no more than "adequate consideration." Updated October 2026: the Retire through Ownership Act, signed October 15, 2026, now lets an ESOP fiduciary rely in good faith on an independent appraisal that follows IRS Revenue Ruling 59-60. This article explains the adequate consideration requirement, the Department of Labor's never-finalized regulations and withdrawn 2025 proposals, and what the new law does and does not change.
