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How to transfer Assets To Your Trust-Part 1

© Susan M. Weschler

Once you’ve set up your trust and decided which assets to transfer, you and your attorney must implement the necessary legal steps and documentation for the assets involved. Since laws can vary from state to state, it is important to consult with an attorney in your area, as to the particular practices and customs that may apply.

Transferring Bank Accounts and Securities to Your Trust

Bank Accounts

For this transfer, you should contact your bank. They will provide you with any necessary forms, including signature cards. They will most likely also require a copy of the trust document. In addition, you will need to complete Form SS-4, to obtain a federal identification number for the trust, in order to open a trust bank account. Next, you will have to order new checks with the name of the trust. The checks usually have the name of the trust, the date of the trust, and the trustee printed on them. The trustee is the person who will actually be the person who signs the checks after the assets have been transferred to the trust.

Securities

If you own stocks and bonds directly in your name, and they are not held in a brokerage account, you will have to contact the transfer agent for the security to obtain the necessary paperwork. Most transfer agent information can easily be found on the internet, by looking in the shareholder services area of the particular company. In some cases, you may be able to download and print the necessary transfer forms directly while on line. Once the paperwork is completed, and you’ve mailed them with your certificates, the transfer agent will reissue the stock or bond certificates in the name of the trust. You may also need to have your “signature guaranteed”. This process is actually a verification of your signature, for your protection. Most large banks are members of the “Medallion Program” and will verify your signature if you are a customer. It is usually a requirement for transfers, and transactions over a certain dollar amount. There is usually a modest cost involved if you are having your shares registered by the transfer agent.

If you have a brokerage account which holds the securities, there are a different set of guidelines to follow. Most firms require that you open a trust account, and then transfer the assets to the new account. This is accomplished by means of a LOI, or Letter of Instruction. Since your certificates are already held at the brokerage firm, they will take care of sending the certificates to the transfer agent. You will supply stock or bond powers, a copy of the trust document, and the LOA. You may also need to you’re your “signature guaranteed” by a bank or large brokerage firm. Usually, there is no cost involved if you are transferring assets directly from one brokerage account to a new trust account.

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