Transfer stocks held in Canada to a US based account?

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beetee
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Transfer stocks held in Canada to a US based account?

Post by beetee »

I posted here a few months ago about my anticipated inheritance of investments from an estate in Canada; I am a resident of the US (and will be executor of the estate). You folks gave me a lot of good information and food for thought. The situation hasn't changed, but I have an issue that I'd like to address: I've confirmed that the broker who holds these assets prohibits non-residents from owning or directing any transaction in their accounts as a matter of company policy. I should be able to spend a few months in Canada when the time comes to settle the estate, but do not anticipate becoming a Canadian resident. So I will be communicating with the broker soon, in advance of need, about how to best handle this situation, since it appears I'll need to designate some resident as executor for purposes of dealing with those accounts--even to authorize transferring them--and I'm wondering whether there's a best approach to this. Any guidance will be welcome. A few specific questions are below:

Is it possible to directly move equities from an account held in Canada to one held in the US? (This would be the ideal solution for me, if stocks from the estate could be transferred to my existing account at Vanguard south-of-the-border. I'm guessing the answer is no, but if there's a way, please advise.)

Are there any Canadian banks or brokerages that you recommend that might allow me, as non-resident executor or as named owner, to control an account that has been transferred over from the existing broker? I think someone mention TD last time. (if it matters, the accounts in question are in BC; if it seemed appropriate I could look into being assigned joint ownership on my mother's existing bank accounts, which are at RBC, I think.)

I see the description of "Norbert's Gambit," but I'm not clear whether that would be useful in my situation: ! am wondering about stocks (such as Bank Of Montreal and TD) which are listed on both the Toronto and New York exchanges. Is it possible to change the designation of the exchange (and currency) with which these stocks trade? Is that a simple matter?

Any other suggestions about questions I should put to the broker (or to bankers, or a lawyer if I must) will be welcome. Thank you in advance.
twa2w
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Re: Transfer stocks held in Canada to a US based account?

Post by twa2w »

When you become executor of the estate, and all the proper paperwork is done and filed, you can direct the broker what to do with the account.
Remember, the brokerage account will be in the name of the estate which is a Canadian resident. As Executor, even as non-resudent, you can direct the broker. But you will be limited as to transactions.
If you are the ultimate beneficiary of the account, you can direct the broker to sell the shares and issue a cheque to the estate. They may but likely will not issue a cheque directly to you.
They will not, because you are nonresident, move the stocks to an account in your name. Nor will they move the shares to a brokerage account in the USA in your name. This is due to liability they would face over potential tax issues and witholdings.
You essentially have one choice as Executor. Sell the holdings and have cheque issued for the proceeds payable to the estate. File the appropriate tax returns, pay what is due, then once you have a final tax clearance certificate, issue a cheque on behalf of the estate, to the beneficiaries.
Take your cheque, as beneficiary, and deposit or wire it to your bank/brokerage in the USA,
beetee
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Re: Transfer stocks held in Canada to a US based account?

Post by beetee »

Thank you very much for this reply, twa2w. I'll need to clarify with the broker that the estate remains resident even if I'm the one giving instructions, as executor. I spoke with the broker in January, and she told me that she couldn't accept orders from me, even as executor, as a matter of company policy. But what you say makes sense so I'll ask her to verify that policy--could be she hasn't dealt with this situation before. Liquidating and depositing the proceeds to the bank account of the estate (where the broker already sends dividends) would be a reasonable solution.

Any thoughts on whether the Toronto/New York listed securities could be sold on the NYSE and liquidated in US dollars? My mother also has an existing US dollar account, where the broker deposits dividends from a couple of US stocks she owns. Seems like that might save some cost and hassle when ultimately bringing assets south of the border.
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Re: Transfer stocks held in Canada to a US based account?

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beetee wrote: 09 Feb 2018 14:50 Any thoughts on whether the Toronto/New York listed securities could be sold on the NYSE and liquidated in US dollars? My mother also has an existing US dollar account, where the broker deposits dividends from a couple of US stocks she owns. Seems like that might save some cost and hassle when ultimately bringing assets south of the border.
Yes indeed. Any TSX stock also inter-listed on the NYSE with the same CUSIP number can be sold on the NYSE and settled in USD. With most brokerages, you have to ask the brokerage to journal the shares over to the USD side of the brokerage account first to sell on NYSE and get settlement in USD.

Added: I see no reason why the estate cannot remain resident in Canada even though you, as executor, are located in the USA.
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beetee
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Re: Transfer stocks held in Canada to a US based account?

Post by beetee »

Thanks, AltaRed. That sounds good--I think the majority of my mother's holdings are "inter-listed" (large Canadian companies), and I'm happy to hear more support for the idea of the estate remaining resident, which would simplify matters considerably.
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Re: Transfer stocks held in Canada to a US based account?

Post by AltaRed »

Check the CRA Guide on Testamentary Trusts to validate, and/or also consider googling 'residency of testamentary trusts' and you will get links to accounting and/or tax firms on whose websites sometimes write on these issues.

IANAL, but I believe that after death, unless a Will states otherwise, most assets are assumed to be held by a testamentary trust.
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Re: Transfer stocks held in Canada to a US based account?

Post by twa2w »

I think when the broker meant she could not accept orders from you, she may have been referring to you actively trading the account.
I know of no reason why they would not accept your direction to journal and sell shares and pay any proceeds to the estate.
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