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If beneficiary cashes out inherited mutual funds, do u get to keep the money the stocks sell for too?

  • My grandmother recently passed away and left me some of her mutual funds/money market investments, which is a total of about $5,600 (she left me 8% of her account). I spoke to the financial advisor at Edward Jones and told him I wanted to cash out all of the money, so he said they would have to automatically withold 10% for federal taxes and it would take about 3 days for processing because the stocks would have to sell or whatever you call it. Well, I called yesterday to find out the status of everything and he said the check would be sent out on Monday. So, my question is... I got some information in the mail today on the trade confirmation showing how much each of the stocks sold for. The total of all of the stocks that were sold adds up to about $2,600. I'm not sure what this means to me?? Do I receive the $2,600 in addition to the $5,600 (minus 10% for taxes) since they sold the stocks from my account??? I'm so confused by all of this. Any answers would be greatly appreciated! Thanks!!

  • Answer:

    There are a couple of issues here: 1. In order to know how much 8% of her account was worth it had to be valued at the time of the trade (not her death if the investments weren't sold shortly there after.) 2. If when the account was valued and it was $70,000 and you were entitled to 8% of that your share was $5,600 ($70,000 x .08) Was this figure now, or at the time of her death? 3. You have to find out from the Edward Jones the value of the account now. He may have only had to sell $2,600 to raise enough cash to settle your obligation or the account may have fallen from $70,000 to $32,500. (It is impossible to determine from what you have written here.) 4. He is incorrect on the 10% withholding IF you provide him with a W-9 showing your Federal Tax ID and that you are not subject to backup withholding. There is no withholding on estate settlements. The estate pays that. He should pay out your share with out tax withholding.

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Other answers

Some where along your line of growth you have missed common sense. You say you spoke to the agent at Edward Jones, a renowned Company, so what is keeping you from using your head and call that company again and ask the quest of them for they will answer truthfully.

greeter7

No you receive a check for $2350. That is what the investments were worth when sold.

Ariaread

It is confusing that you are discussing mutual funds and money market investments on one hand, and then wondering if your sale of stocks is related. Are you sure that you had them sell out the proper account (did you have your own separate account there too), or did your grandmother also have stocks? How would you expect strangers with no access to the account(s) and sketchy information from you to know any details? And unless you are required to have withholding due to your past or it was in a retirement account, you can chose whether to have withholding or not, if you provide them with a W-9 or their equivalent.

efflandt

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