Between January 1, 2024 and December 31, 2026, business owners can access significant tax benefits when selling a qualifying business to an employee ownership trust ("EOT") pursuant to a transaction that constitutes a qualifying business transfer. Among other benefits, eligible vendors are entitled to receive a shared pool of up to $10 million in capital gains deductions (the "EOT Deduction").
This article covers the following topics:
- Qualification Requirements for EOTs;
- Distribution Structures for EOTs; and
- Qualification Requirements for EOT Transactions.