Promotion and Expansion of Private Employee Ownership Act of 2025
About This Bill
Committee
Latest Action · April 30, 2025
Referred to the Committee on Ways and Means, and in addition to the Committees on Small Business, and Education and Workforce, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned.
The Promotion and Expansion of Private Employee Ownership Act of 2025 aims to encourage employee ownership of S corporations through employee stock ownership plans (ESOPs). The bill removes a tax deferral deadline that was set to expire in 2027, allowing business owners to indefinitely defer capital gains taxes when selling stock to employee-owned plans. It also changes Small Business Administration rules so that companies remain eligible for small business benefits even after an ESOP acquires more than 49 percent ownership, as long as the company still meets other size requirements. The legislation creates two new federal positions—a Treasury Department office to provide technical assistance on S corporation ESOPs and a Labor Department Advocate for Employee Ownership to educate workers and employers about these ownership opportunities. The bill takes effect immediately for tax provisions and January 1 of the following year for Small Business Act changes, with no specific funding amount mandated but authorization for necessary appropriations included.
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