HOWTO: Transfer your US brokerage account to a new broker RRS feed

  • General discussion

  • This is a way to transfer your US brokerage account to a new broker in Money.There are various reasons that you might want to make the change. You may have two brokers, and want to simplify to one. Your account at OldBroker may come with advice or services that has not been worth the fees. You may want to move to a new full service broker where you can pay more money to your new broker friend.  You may want to take advantage of some other feature, such as being accessible via PocketSense.

    I will presume in this HOWTO that you will download transactions from the new broker via PocketSense and that you are in the US, although the techniques would work if you enter transactions by hand.

    In doing a broker transfer in the US, you fill out paperwork with the *new* broker, and specify you want to transfer everything. You may start the paperwork online, but you will deposit paperwork at the new broker in person or by mail. You provide a copy of your latest statement. At this point, the new broker takes over, and does the operation. Your old broker is unlikely to call you. The transfer is done via a system called ACATS, and cost basis information is usually passed via a system called CBRS. You don't need to know about that; it just happens. OldBroker typically charges a transfer fee of $100 or less. The new broker may reimburse or give you free trades, or give nothing extra. The transfer does not count as a sale for tax purposes. You can ask before deciding to transfer.

    When you supply your paperwork, you indicate whether the securities should go into a new account, or be added to an existing account of the same type. You will see your old broker account showing the securities to disappear. At the new broker you may see some indication too. When the securities and cash arrive at the new broker, you will probably download an AddShares transaction via PocketSense. Accept the transaction, but then Edit the transaction. Change AddShares to TransferIn. That cause a new TransferFrom box to open, and you will select your old broker account from the drop-down list. This causes a TransferOut transaction to be generated in the OldBroker Money account. Do this for each security.

    There will also be cash transactions. Your money market fund at the old broker will be changed to cash, and the cash will be transferred. In the Cash Transactions, change the category to Transfer:OldBroker(cash). The old broker account transfer fee may come across as a negative cash transaction in the new account. Set the category accordingly.

    In the old account at this point, there should be no remaining securities. There may be a cash balance showing in the cash account. Any remaining balance at this point were fees that were never entered into the Money account. These were probably management fees. Enter one or more Payment transactions to bring the balance to zero. You can try to go back through old statements if you suspect something is worth investigating.

    You are almost done. There may be some dividends or distributions from holdings that were accrued but not yet paid. Those come over automatically. Decide whether to enter the dividend in the old account, and transfer the cash to the new, or to just enter the dividend in the new account. It will come in to the new account via PocketSense as a cash transaction. You will get a 1099 from OldBroker for dividends, sales done at the old broker, and any other. That should be a one time event.

    Thursday, November 9, 2017 2:16 PM