If you inherit stocks from the US while living in the UK, you may feel rather lucky. However, there are some hoops to jump through when it comes to transferring or selling these stocks. US share transfer agents have strict anti-fraud requirements that differ significantly from the UK system. This blog looks at how to handle inherited US shares.
Medallion Signature Guarantee
A Medallion Signature Guarantee is a mandatory US anti-fraud measure required for transferring or selling US securities held outside a major brokerage account.
Unlike in the US, where thousands of banks and brokerage firms provide the MSG, standard UK high street banks do not offer this service, nor do regular UK Notary Publics. You must use a specialist provider in the UK who is a member of the Securities Transfer Agents Medallion Programme. Some UK-based legal firms and international probate specialists offer this service.
US Tax Clearance
Beyond the Medallion Guarantee, you may need clearance from the US Internal Revenue Service. If the total value of the deceased’s US assets was valued at over $60,000 at the date of death, you will likely need a Federal Transfer Certificate.
Obtaining this certificate requires filing specific US estate tax forms with the IRS, even if no tax is ultimately due under the US-UK tax treaty. This can be a lengthy process, often taking many months. If the share value is significant, your specialist Medallion provider or an international probate solicitor should manage the IRS clearance process to ensure the transfer agent accepts the sale.
Right Brokerage Route
Once you have the Grant of Probate, you have two options for selling the shares:
- Many US companies use specific transfer agents, who can handle the sale directly once all the paperwork, including the MSG, is approved. This is usually necessary for shares held in certificate form.
- You can transfer the shares to a major UK broker that offers dealing in US equities. Once the shares are in a UK account, they can be sold easily via the platform’s standard process. This is the simplest long-term option if you wish to hold the funds in a UK ISA or Investment Account.
In Conclusion
Selling inherited US stocks is undeniably complex and involves some administrative duties. The Medallion Guarantee and specific IRS paperwork often make instructing an international probate specialist the most efficient and reliable way to liquidate assets.
Contact Medallion Guarantee on 0203 985 9551.