Gathering and transferring the assets of a deceased person can sometimes seem like an impossible task. It's one thing to give Jenny her grandmother's favorite necklace, but when it comes to things like stocks and bonds, most family executors are at a loss. While there is a lot of paperwork involved in transferring stocks to a beneficiary, the procedure is nearly universal, no matter what stock you're transferring.
TL;DR (Too Long; Didn't Read)
The executor of an estate has the ability to complete the necessary paperwork in order to ensure that stocks and other investment assets are transferred to the proper beneficiary.
Responsibility of the Executor
Stock transfers should be completed by the executor of the estate or by someone appointed by the executor and who has power of attorney for the decedent. This person will fill out stock transfer paperwork, send it to appropriate parties and make sure the transfer is completed in a timely manner.
Paper Stock Certificates
If the decedent held stock on paper certificates, begin by contacting the transfer agent for the stock. You can find the transfer agent listed on the "investor information" page of the company website, or by calling the company's investor relations department directly. The transfer agency will provide specific instructions for paperwork and mailing, along with any stock-specific forms needed to complete the transfer. The executor may request the transfer in two ways: by filling out the back of the stock certificates themselves or by completing a stock transfer form. In either case, mail the completed request and/or certificates along with copies of the death certificate, will and power of attorney to the transfer agent. The transfer agent will then issue new certificates to the beneficiary. In some cases, the transfer agent may allow the beneficiary to request an electronic deposit of the stock to a brokerage account at the same time as the shares are re-registered. This usually involves an additional form or specific wording within the transfer request.
Electronic Stock Certificates
If the shares are held at a brokerage or other money management firm, they are most likely held electronically, meaning that there is no paper certificate. In that case, the executor completes a stock transfer form only, and may provide direction for all the stock in the portfolio at once. The brokerage firm provides specific paperwork for such transfers. As with paper certificates, the executor should provide a copy of the decedent's death certificate, will and power of attorney. The brokerage firm will then transfer the shares to the beneficiary's account.
Understanding the Medallion Guarantee
All signatures relating to the transfer of securities should be medallion-guaranteed. This is similar to having a signature notarized, but it is specific to financial securities only. Most banks and brokerage firms provide medallion guarantee service for clients. The executor should present all paperwork to the guarantor and sign it in front of him.
Assistance from Experts
If you are unfamiliar with securities paperwork and terminology – and most people are – don't hesitate to ask questions of the transfer agents and brokerage firms. These experts may provide you with step-by-step instructions and firm-specific forms that will help to ensure a speedy and accurate transfer.