Transferring Stocks After Death

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Can Stocks or Securities Be Passed on to Beneficiaries?

Yes, it is possible to purchase stocks or securities that can be passed on to your beneficiaries. However, this will ultimately depend on the laws of the state you live in. If a state has adopted the Uniform Transfer On-Death Security Registration Act, then you may arrange your securities (e.g., stocks, mutual funds) to be transferred to a beneficiary when you die. This will make the beneficiary the new owner of the securities.

What Is the Benefit of Transferring Ownership of Securities?

When someone transfers ownership of their securities under the Uniform Transfer On-Death Security Registration Act, they do not need to put securities into a will. The benefit of this is that securities will not have to go through probate. Without being subject to the probate process, securities can be quickly turned into liquidated cash to be used for an estate's expenses and debts.

How Can I Arrange to Transfer Ownership of My Securities to My Beneficiaries?

In order to create a "beneficiary form" for securities, the securities must be registered as being "transferable on death" (TOD) with the financial intermediary from whom the individual purchased those securities. After that person dies, their beneficiary can request to have the securities reregistered in their name. It is common to be asked to provide a copy of the death certificate.

Should I Consult an Attorney When Planning My Estate?

Trying to create a plan for what will happen to your estate after you have died can be quite a complex and confusing process. There are many options, each of which have different tax implications and other consequences on your estate and beneficiaries. It is wise to consult an attorney who has experience with estate planning. An estate planning attorney can advise you of all options available, and help you decide which ones would be most beneficial to accomplishing your goals for your estate and family.

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Last Modified: 08-19-2014 10:09 AM PDT

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