The steps in changing the ownership of stock are as follows:
Identify the stock transfer agent
Prepare a Stock Power naming the trust as the new owner*
Prepare an instruction letter to the stock transfer agent
Secure a guaranty of the owner's signature on the stock power
Send the signature guaranteed stock power and stock instruction letter to the transfer agent.
*Note: For help in drafting a Stock Power and changing ownership of stock, contact an estate planning attorney with experience in trust funding.
Changing Ownership of Stock: Stock is generally retitled by contacting the transfer agent for the corporation and requesting that the ownership be changed to the name of the living trust.
Identifying the Transfer Agent: Often times, the most difficult aspect of changing the ownership of stock is identifying who the transfer agent is. Sometimes the name of the transfer agent may be printed on the back of the stock certificate. In the event no transfer agent is identified on the stock certificate, the easiest way to ascertain the agent's name is to to determine if you are in possession of any correspondence from the corporation or the transfer agent identifying the name and address of the transfer agent.
CAUTION - Stock Held for a Long Period of Time: If the client has held the stock for a long period of time, the transfer agent named on the back of the stock certificate may no longer be the current transfer agent. It may be prudent to contact the person or the entity identified as the transfer agent on an old stock certificate to confirm that they are still the current agent. This step will prevent inadvertently sending a request to change ownership to the wrong agent. It will also save time and reduce the risk that the certificate may be lost. If the agent listed in no longer serving, they should be able to provide you with the name and address of the current stock transfer agent.
Signature Guarantee: Most transfer agents will not accept a stock certificate for retitling unless the owner's signature has been formally guaranteed. A signature guarantee is similar to having a signature notarized; however there are additional requirements for a signature to be guaranteed. Moreover, there are different types of signature guarantees. The most common type is the Medallion Signature Guarantee. Most stock transfer agents will require that signatures be Medallion Signature Guaranteed. Accordingly, your should not execute the stock power until you are in the presence of the signature guarantee. There generally is not a charge to have a signature guaranteed. Should you need any assistance in identifying a local Signature Guarantee in your area, contact an estate planning attorney with experience in trust funding.
Mailing the Stock Certificates: It is prudent to send the stock power and stock certificates to the transfer agent by certified mail, return receipt requested as well as to have the contents insured.
Time Expectations: The time it takes to receive a re-issued stock certificate will vary from transfer agent to transfer agent. On average, it will generally take anywhere from 30 days on the short end to as long as six months to receive the re-issued stock certificate.
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