Tracking Down Inherited Stocks

Question

Recently, my father passed away. My mother is his sole heir (as is proper) and I am her only child, helping her navigate through to her new situation. All of us live (lived) in the United States our entire lives.

Most of the finances are well-understood: There is a clear, simple uncontested will leaving everything to my mother, and most assets were jointly owned anyway. Life insurance policies, social security papers, pensions, and a reasonable middle-class managed financial account seem in good order. The size of the estate is small enough for federal estate tax exemptions.

There is one exception: In the process of going through his effects, we have found physical stock certificates acquired generally in the early 2000s. They happen to be for various US-based telecommunications companies, and even at a glance I can tell that this can become potentially complex due to splits, acquisitions, renaming, etc. (As the roughest of estimates, it seems to be worth about 10% of the separate managed account, so, by our standards a substantial sum.)

We've also found one letter (to Computershare) directing the sale of a small portion of these stocks in the mid 2010s, so we know my father was at least slightly active with these stocks.

Here is the problem: That one letter directing sale, and those stock certificates are currently all we have to go on; we have no guarantee we have found or ever will find everything; and I know less than nothing about the details and mechanics of owning or trading stock as certificates.

How is it possible to fully, efficiently, and frugally (in that order-- a full accounting is best even if it takes longer or costs a bit extra) understand his stock holdings? Bear in mind that we're uncertain if he used Computershares exclusively, or if he bought other stocks (with certificates or online) or if he had one or more brokerage accounts we are not aware of.

If the answer is, "Get a lawyer," or "Hire outside help," please be so kind as to include a description, i.e., "You need a lawyer specializing in X, Y, and Z," or, "The type of firm you are looking for is often referred to as..."

Answer 1

There are several avenues of approach from your side of the fence and none are guaranteed to be thorough.

1) Look for any information in your father's records that indicates what brokers that he dealt with. Contact them and see if you can acquire account statements.

2) Look at any available tax returns. Prior to online filing (2009), I used to keep trade confirm slips and/or the monthly statements with the tax return. Also, look at Schedule B. Any broker that paid interest on cash balances will be listed there.

3) Since 2009, we've had online filing. Broker interest listed by broker on Schedule B still applies. The same holds true for Ordinary Dividends on Schedule B and Capital Gains on Schedule 8949 if your father or his accountant submitted them as a summary in the broker's name rather than individually by issuer. Again, the objective is to find broker names.

4) Check with your father's accountant, if he used one.

5) You might check the Unclaimed Assets list at your state's web site.

6) Speak to your accountant and/or family lawyer and ask what the next step is after these attempts. While I don't know of it, perhaps there is some legal/professional help available or way to access the records of the IRS or brokerage firm(s) or clearing agents.

Good luck.

Answer 2

those stock certificates are currently all we have to go on

Some time ago, it was common to hold physical certificates for the shares of stock you owned. This is far less common today, as most stock is held by the broker. One of the benefits of this is that when any activity occurs, such as a stock split, a takeover, merger, etc, your account simply reflects the new positions once the transaction is complete.

In your case, I’d ask your favorite broker if they would handle the transaction for you. You literally call and say, “I have shares of old telecom and would like to know if you can get it converted to the new companies it spun into.”

The other way is to search on the old company names, see what they are now, and contact investor relations. They should be able to tell you who the transfer agent is who can arrange for the new shares to be dilivered to you. Disclosure - I’ve bought and sold stocks for nearly 40 years and have never had a certificate sent to me. I’ve always had the broker hold on to the shares.