What is a KSOP?
Because a KSOP is a combination plan, it has features of both ESOPs and 401(k)s. KSOPs also indirectly create a marketplace for employees to sell their .and 401(k)s. Companies can match contributions and reduce the expenses involved in running separate
Most companies create KSOPs to provide the motivation, inspiration and retention associated with ownership. Like other, the ultimate benefit to the employee depends on the amount contributed and the performance of the in the . KSOP participants and sponsors can enjoy some unique tax advantages, but when KSOPs new shares, they can dilute existing shareholders.
How Does a KSOP Work?
An fund assets in the employer’s stock. The employer's contributions are usually in the form of stock options to purchase shares of the company. Typically, in a KSOP the employer matches any contributions that employees make to the plan with stock instead of cash. So, if John Doe $500 into his KSOP account and the company offers to match contributions, the employer $500 of stock into John's KSOP account.