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My wife received some stock when she was younger. Her father passed away a few years ago, and she would now like to sell it. She seems to have an incompetent broker, as she has been given different answers each time she has called him. What steps should we take to make the sale? My wife is over 21, we are in the US.

Finally got a bit more information. She received these when she was 10. Her dad is listed as the custodian. She is now 27 years old. Her maiden name is listed on the certificates.

  • She called Pepsi to attempt to change her address. They told her that she needed to fill out a form, and mail in the certificates to them to change their address. According to my wife, the broker changes his story each time he calls in from, I can sell that without any problem to the next time that he can't do anything with it (without a death certificate, birth certificate, etc... which she has sent in multiple times). – Scott Dec 30 '11 at 20:58
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It depends on when she became the shareholder of record.

When your wife received the stock, was ownership clearly transferred to her? If it was, then she should have the right to sell it if she wants. The gross amount of the sale will be reported to the IRS, and then it will be up to you (and/or your tax advisers) to determine its tax basis so that you pay tax only on the appropriate gain.

If she hasn't become the shareholder of record yet, then it can be a bit of a mess. Your wife's father saying "Merry Christmas; I'm giving you 500 shares of AAPL" doesn't transfer ownership to you. Him calling up the brokerage and transferring them into an account with her name (or her name and his name) does.

Is your wife's father's estate settled yet? If not, then sorting all of this out is part of the fun. If it is, and this asset was left dangling out there, then that's beyond anything I know about.

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They may be confused. The combination of "my wife received stock when younger" and "her father just died" leaves questions. A completed gift, when she was a kid, means she has a basis (cost) same as the original owner of that stock. This may need to be researched. The other choice is that she gets a price based on the date of dad's death, a stepped up basis, if it was his, but she got it when he passed. No offense to them, but brokers are not always qualified to offer tax advice.

How/when exactly did she get to own the stock.

Upon second reading it appears I answered this from a tax perspective. You seem to have issues of ownership. What exactly does the broker tell you? In whose name is the statement for the account holding these shares?

Scott, saw your update. For the accounts I have for my 13 year old, I am custodian, but the tax ID is her social security number. When 21, she doesn't need my permission to sell anything, just valid ID. What exactly does the broker tell her?

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It depends on when, where and how the account was setup.

If the state has an UGMA (Uniform Gift to Minors) law, the account was probably opened under that -- in which case, your wife became the custodian by statute at age 18 or 21. She has always been the account owner.

The "catch" is that if your wife's father died before she assumed custodianship of the account, it may be subject to taxation.

You may be in some sort of oddball situation where due to your wife moving, the broker merging or lost records, the phone reps cannot figure out what is going on. I'd suggest working the phone tree a little harder and searching for old records.

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The question seems to be from the point of view actual sales and not its impact on one's taxation.

In case you just want to sell, why brokers will respond differently each times. Either there may be issues with ownership and/or the company whose shares it is?

In case you feel that the issues lies with brok

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    Your answer appears to be incomplete .. did you submit prematurely? – Chris W. Rea Dec 26 '11 at 15:25

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