How Your Stocks Will Be Handled After You Pass Away
Posted on: 1 February 2021
If you own stocks, you might wonder what will become of them when you pass away. This is based on the provisions you made before you passed away and will be affected by probate. There are several matters you might want to discuss with an attorney.
Jointly Owned Stocks
If you own stocks with your partner, the jointly owned stocks will belong to them after you pass away. However, you might also own stocks entirely on your own and these will be handled differently. Some stocks do not have a right of survivorship and half of the stock will go to the party that jointly owns it while the other part will go through probate.
Beneficiaries
If you designate a beneficiary to one of your stocks, that beneficiary will receive the stock when you pass away. Naming a transfer-on-death beneficiary will allow you to avoid the probate process. Most states follow the Uniform Transfer on Death Security Registration Act which means that a beneficiary will receive a stock immediately when you pass away.
The stocks do not even need to be listed in your will. The beneficiary simply needs to re-register the stocks under the appropriate name. Simply sending your death certificate and the identification of the recipient is enough to re-register. If a beneficiary is still not sure if the stocks will be a part of the probate process, they should contact a probate attorney.
Stocks That are Part of a Trust
If the stocks are a part of a trust, they will not be included as part of the probate process. They will instead be administered through the trust.
Stocks That Do Not Have a Beneficiary Named
For those stocks which do not have a beneficiary, they will become a part of the probate process. This process is used to determine who should obtain ownership of the stocks. The courts will then direct the executor of the estate to transfer ownership of stocks as instructed. The executor will need to be provided with a copy of your will and a death certificate. The transfer agent completes the transfer.
Discovery
To be able to distribute your stocks and bonds, a personal representative will look through your safe deposit box, physical files, and mail to find any physical stocks or bonds, statements from financial institutions where you might have stocks, and statements from corporations that show that you owned corporate stock. A probate attorney can help you with understanding what steps you should take. Contact a probate attorney for more information regarding probate law.
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