LLC ESOP
In what appears to be the first ruling of this nature, the
Internal Revenue Service recently issued a private letter ruling to the effect
that a limited liability company may adopt an employee stock ownership
plan. Doing so requires, however, that
the LLC elect, for federal tax purposes, to be classified as a corporation. As such, within the limits of this ruling
(and technically it may be not be relied upon by anybody other than the party
to whom it was addressed), it remains that a ESOP may not be adopted by an LLC
that is taxed either as a disregarded entity or as a partnership.
PLR 201538021 (September 18, 2015).
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