Sale & Transfer Services Medallion Guarantee Tips

Medallion Guarantee - Tips

• "Book Entry" Shares
• Missing Shares Certificates
• In direct contact with the US Share registrars
• US Shareholdings in excess of US $60,000

"Book Entry" Shares

If the shares are what is known as "book entry" shares, i.e. they are held in electronic form, then a dividend statement will be sufficient for our purposes or a "Direct Registration Statement" (sometimes simply called a "DRS Statement"). These DRS Statements are usually issued by the Company's share registrars every 6 months, and so the most recent DRS Statement will be best. If you also have the original DRS statement that was issued when the shares were first converted into electronic form, this also will be very useful to establish and confirm the ownership of the shares.

Missing Shares Certificates

You should note that if any share certificate was issued and it has been lost, then the share registrars will need an indemnity from you based upon the value of the shares. You will have to pay an insurance premium to the share registrars (or their nominated insurer/ indemnifier) which may be in the region of US$350.

In direct contact with the US Share registrars

If you are dealing directly with the share registrars in the USA, you may care to note that on many occasions they have a time limit within which the Certified Copy of the Probate/Confirmation must be dated - usually somewhere between 45-60 days before being submitted to the US Registrars.

US Shareholdings in excess of US $60,000

The rise in the US stock market since 2009 has resulted in many estates having US shareholdings which exceed the limit of US $60,000 and this entails the filing of Form 706-NA and other related Forms.

This ensures that the US IRS recovers US Estate Taxes when due, but under the US/UK Double Tax Treaty there should not be any US Estate Taxes payable, but the Forms still have to be prepared and filed so that the US IRS will issue the needed Federal Transfer Certificate (Form 5173).

Without the Federal Transfer Certificate you will not be able to transfer the shares into the names of the Executors as the share registrars will not transfer the shares into the names of the Executors without the needed Federal Transfer Certificate. You will therefore not be able to sell the shares until the Federal Transfer Certificate has been obtained.

Share Data is familiar with what is involved, the preparation of the Forms for filing and of the necessity of filing the appropriate Forms at the appropriate time. We will be happy to relieve you of the worries involved

You should note that by its own admission the US IRS it will take a year from the time that the documents are submitted before the Federal Transfer Certificate is issued, so you must inform your clients of the long time period that will be involved.