Congressman Allen's Retire through Ownership Act Headed to President Trump's Desk

Yesterday, the U.S. House of Representatives passed S. 2403 , the Retire through Ownership Act. Congressman Rick W. Allen (GA-12) introduced the House version of this bill last year, which would provide legal and regulatory clarity in the formation of new Employee Stock Ownership Plans (ESOPs). Following House passage of S. 2403 by a vote of 401-14, Congressman Allen issued the statement below: "One of the many lessons I learned over my decades-long career as a small business owner is that true success is measured by the success of your employees. ESOPs are a valuable tool to build wealth for retirement and give employees an ownership stake in their employer. The Retire through Ownership Act will help eliminate the regulatory ambiguity and unnecessary risks these plans often face while providing a clear framework for valuing employer stock. I am proud that this bipartisan, bicameral bill is one step closer to the finish line as we continue to advance policies that ensure more Americans can enjoy a secure retirement," said Congressman Allen, Chairman of the Subcommittee on Health, Employment, Labor, and Pensions. "ESOPs provide employees with a meaningful foothold in capital ownership—allowing them to share in the success they’ve helped create. Unfortunately, lack of clarity in the law has brought uncertainty and created legal grey areas. S. 2403 fixes this problem by providing clear guidance," said Representative Walberg, Chairman of the Committee on Education and Workforce . "Employee ownership is a proven asset for workers, businesses, and our economy, and it should not be undermined by ambiguity in the law. I’m glad to see this critical legislation make it to the president’s desk—ending over fifty years of confusion and strengthening employee ownership." BACKGROUND: Employee Stock Ownership Plans (ESOPs) let workers build retirement savings by owning stock in their company. When an ESOP buys stock in a private company, an independent appraiser helps determine what that stock is worth. The Department of Labor (DOL) has not yet finalized clear rules for how private company stock should be valued in an ESOP transaction. That leaves ESOP trustees without a clear federal standard to follow when deciding whether the price is fair—creating uncertainty and legal risk for trustees and businesses. S. 2403, Retire through Ownership Act , gives ESOP trustees a clearer rule to follow: If an independent appraiser follows the Internal Revenue Service’s longstanding guidelines to determine what a company is worth, the ESOP trustee can rely on that appraisal to decide if the price is fair. This legislation now heads to President Trump's desk. Prior to House passage of the bill, Congressman Allen participated in debate on the House floor. Watch HERE .