Under normal circumstances, the process of administering the will of someone who has passed away is done via probate. This includes transferring assets such as stocks. However, if you want a beneficiary to bypass the probate process and immediately receive the transfer of your stocks, you need to complete a transfer on death registration. This type of registration allows you to name a beneficiary for your stocks upon your death. The process can be completed whether your stocks are in a brokerage account or they are physical paper certificates.
Contact your broker if you have a brokerage account and tell him you want to name a beneficiary for your stocks. Your broker will mail you a transfer on death beneficiary form.
Fill out all of the required information on the form, such as your full name, Social Security number and the name and address of the beneficiary. You must sign the form in the presence of a licensed notary public, who must also sign and date the form.
Mail the form back to your broker using certified mail service. After your brokerage account has been updated, your beneficiary's name will also be listed on the account after your name as the transfer on death beneficiary.
Paper Stock Certificates
Call your broker for information on how to transfer you current stock certificates into beneficiary form. If you don't have a broker, contact the transfer agent that manages the stock certificates. You can find the transfer agent's contact information from the investor relations department of the company that issued the stocks. The broker or transfer agent will ask you to send him your paper certificates and will mail you a stock or bond power form.
Complete all of the fields on the stock or bond power form when you receive it from the transfer agent or your broker and sign it. Write a letter explaining that you want to name a beneficiary for your stocks and sign the letter. Write the full name and address of the beneficiary in your letter.
Mail the stock certificates, your signed letter and the stock or bond power form together via certified mail to your broker or the transfer agent. The broker or transfer agent will have new stock certificates issued in beneficiary form and mailed to you.
- Inform your beneficiary of the transfer on death registration of your stocks so that he is aware of his status as the beneficiary.
- At publication, the only states where you cannot name a beneficiary on your stocks is Texas and Louisiana.
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