Author Topic: Inherited non-qualified accounts: Can Transfer to Vanguard?  (Read 443 times)

MilesTeg

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I have an inherited non-qualified account with Ameriprise (which is a ridiculously expensive investment platform). As an inherited account, the bonds and stock in the account have an adjusted cost basis.

Does anyone have experiencing transferring such an account to Vanguard (or some other brokerage with at least a sane fee structure like TD Ameritrade)? Does a transfer maintain the adjusted cost basis with an "in kind" transfer?

Thanks

MustacheAndaHalf

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Re: Inherited non-qualified accounts: Can Transfer to Vanguard?
« Reply #1 on: May 15, 2021, 04:31:19 AM »
I'd recommend getting a cost basis report of those assets first, in case it doesn't show up correctly at Vanguard.  I haven't used Ameriprise, but it might be under "taxes" if it's not under cost basis reports.

Note you want to initiate the transfer of assets from Vanguard.  They have the incentive to help you become their customer.  The company you're leaving does not.


terran

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Re: Inherited non-qualified accounts: Can Transfer to Vanguard?
« Reply #2 on: May 15, 2021, 09:25:54 AM »
If the cost basis is pretty similar to the current value it might be easier to just sell everything, especially if they aren't things you'd invest in normally.

reeshau

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Re: Inherited non-qualified accounts: Can Transfer to Vanguard?
« Reply #3 on: May 15, 2021, 10:29:41 AM »
What kind of securities are in the account?  There may be some mutual funds which are not traded on the other platform, and so can't be transferred in kind.  (Availability could also determine which platform you choose to transfer to)  Of course, in a non-qualified account that could trigger a big tax payment--which is not an excuse not to do it.  You just might take some prudent steps, like transfer all assets that are handled by the receiving platform, and then sell down the rest as your tax circumstances allow.

Definitely secure a record of the cost basis before attempting; don't leave that to chance.

MilesTeg

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Re: Inherited non-qualified accounts: Can Transfer to Vanguard?
« Reply #4 on: May 15, 2021, 01:51:06 PM »
If the cost basis is pretty similar to the current value it might be easier to just sell everything, especially if they aren't things you'd invest in normally.

The goal actually is to sell everything because it's almost thirty alphabet soup bonds and funds in the 3 to very low 4 figure range that don't even remotely fit my investment strategy. Unfortunately, that would cost me $25 a pop to sell so I want to liberate these things from that insanity with an in kind transfer if at all possible.

My parents were getting screwed really hard by their advisor.
« Last Edit: May 15, 2021, 02:27:56 PM by MilesTeg »

seattlecyclone

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Re: Inherited non-qualified accounts: Can Transfer to Vanguard?
« Reply #5 on: May 16, 2021, 02:24:53 AM »
If the cost basis is pretty similar to the current value it might be easier to just sell everything, especially if they aren't things you'd invest in normally.

The goal actually is to sell everything because it's almost thirty alphabet soup bonds and funds in the 3 to very low 4 figure range that don't even remotely fit my investment strategy. Unfortunately, that would cost me $25 a pop to sell so I want to liberate these things from that insanity with an in kind transfer if at all possible.

My parents were getting screwed really hard by their advisor.

Be aware that these assets may cost nearly as much to sell at Vanguard, if not more. Per Vanguard's fee schedule, non-Vanguard mutual funds can cost $20 to trade for clients with less than $1 million invested in Vanguard funds, and bonds can cost you 0.1% of the face value to trade on the secondary market.

MilesTeg

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Re: Inherited non-qualified accounts: Can Transfer to Vanguard?
« Reply #6 on: May 28, 2021, 07:54:05 PM »
In case anyone cares, I took the advice to sell all the alphabet soup at Ameriprise in order to avoid any confusion on the adjusted cost basis of the inheritance. It was only a small amount of gain (~1%) due to most of it being in bond funds (and with the adjusted cost basis very little time to appreciate) so the tax hit was acceptable.

After comparing costs at Ameriprise and at Vanguard I found that Vanguard would only be a bit cheaper because a lot of the alphabet soup was in ETFs which were free at both places. I begrudgingly paid the steep per-transaction prices at Ameriprise for the peace of mind about cost basis.

Anyway, I guess I ended up not actually "transferring" the account as I liquidated it and just moved the cash to my regular investment account, hah. I did have an inherited IRA that I transferred in kind though as there was, obviously, no concern with cost basis being a traditional IRA.