One-time ESOP retirement plan dividend distribution & streamlining the retirement plan
Founded in 1884 by an Austrian immigrant, Ganahl Lumber is the oldest lumber yard in California. It is a family and employee owned company. In 1976, the company began an Employee Stock Ownership Plan (ESOP) which allowed the employees to become owners. Today, most Ganahl employees either are, or can become, part owners of Ganahl Lumber through the ESOP. Many employees have been with Ganahl for over 30 years, their entire career.
In late 2012, Ganahl CFO, John Ganahl, needed to make a one-time retirement plan distribution to over 500 plan participants. He preferred to outsource this service to an expert who could handle not just payment distribution but other administrative requirements such as tax withholding, 1099R reporting and missing participants.
The PenChecks Solution
PenChecks provided a turnkey solution for Ganahl Lumber. Over a two week window in November, PenChecks set up nearly 600 accounts and processed dividend payments that arrived to recipients before December 25. PenChecks handled Federal and State withholding and distributed 1099R forms.
ESOP participants received their dividend distribution prior to December 25 and received accurate and relevant tax support documents.
The distribution was executed in a tight timeframe and Ganahl was able to completely outsource every element of the one-time dividend distribution without burdening internal resources.
With PenChecks following up on uncashed checks, Ganahl was able to update its pension program and validate accurate addresses of all participants.