Detailed Answer — How the transfer normally works

When someone who owned a brokerage account dies, what happens next depends on how the account was titled and whether a beneficiary was designated. If the decedent owned the account solely in their name (no joint owner with rights of survivorship, no Payable-on-Death/Transfer-on-Death beneficiary, and no beneficiary designation), the account is part of the decedent’s probate estate. The appointed personal representative must collect that asset, manage or liquidate it as needed, and deposit cash proceeds into an estate checking account to pay debts, taxes, and make distributions under the will or intestacy rules.

Authority and duties of the personal representative

Under South Dakota’s probate rules (Title 29A of the South Dakota Codified Laws), a personal representative has authority and fiduciary duties to collect and preserve estate property, pay valid claims, and distribute remaining assets according to the will or law. See the South Dakota Probate Code (Title 29A) for statutory language and procedures: South Dakota Codified Laws, Title 29A (Probate).

Typical steps you will follow

1. Confirm ownership and beneficiary designations. Check the brokerage account title and any beneficiary or Transfer-on-Death (TOD/POD) designation. If the account names a survivorship owner or a TOD beneficiary, assets usually pass outside probate and do not need to be deposited into the estate checking account.
2. Open an estate checking account. After appointment, the personal representative should open an estate (fiduciary) checking account at a bank. The bank will require the personal representative’s identification and the court’s Letters Testamentary or Letters of Administration.
3. Obtain the court’s appointment documents. File a probate petition in the county where the decedent lived (if not already filed) and obtain certified Letters Testamentary or Letters of Administration from the probate court. The probate court grant and documents are the brokerage’s typical proof that the representative has authority.
4. Gather certified death certificates. Brokerages commonly require several certified copies of the death certificate (often 3–10). Order these early from the funeral home or the vital records office.
5. Contact the brokerage’s probate/estate department. Each firm has a process and forms to transfer accounts. Provide the certified death certificate, the original or certified copy of Letters, broker-specific transfer forms, and any requested identification or IRS forms (e.g., a fiduciary IRS Form W-9 or federal tax ID for the estate).
6. Decide whether to transfer in-kind or liquidate. The brokerage may allow you to retitle the account in the estate’s name (for example, “Estate of [Decedent], by [Personal Representative], Personal Representative”) so assets remain invested. Alternatively, you can sell securities and request a check payable to the estate or instruct the brokerage to wire funds into the estate checking account. Be mindful of timing, market conditions, creditor claims, and tax consequences before selling.
7. Deposit proceeds into the estate checking account. If the brokerage issues a check to the estate or wires money, deposit it into the estate checking account. Keep detailed records and bank statements for the estate accounting and eventual distribution.

When you do NOT need to use the estate checking account

• If the account automatically passes to a joint owner by right of survivorship, the joint owner owns it outright at death.
• If the account names a payable-on-death (POD) / transfer-on-death (TOD) beneficiary, the brokerage will transfer directly to that beneficiary.
• If the account is already jointly owned with equal survivorship rights or held in a trust that names successor trustees, probate may be avoided and the estate checking account may not be necessary for those funds.

Documents brokerages typically request

• Certified death certificate (multiple originals may be requested)
• Letters Testamentary or Letters of Administration from the probate court
• Brokerage probate transfer forms (each firm has different forms)
• Personal identification for the personal representative
• Estate federal tax identification number (EIN) for the estate — you usually obtain this from the IRS after appointment
• Any will or affidavit the brokerage asks to review (some brokerages request a copy of the will if probate was opened)

Timing, taxes, and other practical concerns

Brokerage transfers can take days to several weeks, depending on documentation completeness and institutional backlog. Consider these items:

• Obtain an estate EIN early — many brokerages will not accept checks payable to “Estate of” without an EIN for the account.
• South Dakota does not impose a state estate tax, but federal estate tax rules and income tax reporting still apply. Check federal rules for capital gains and estate income tax reporting.
• Keep the estate funds separate from the personal funds of the representative. Deposit brokerage proceeds only into the estate checking account to avoid commingling.
• Maintain detailed records of any sales, transfers, distributions, and fees — you will need these for creditor claims, accounting to beneficiaries, and final probate accounting.

When to consult an attorney

Consider hiring a probate attorney if the estate is large or complex, several beneficiaries dispute distribution, the account has unusual assets (partnership interests, restricted securities), the brokerage refuses to recognize your authority, or you encounter creditor issues. A lawyer can also advise about fiduciary tax returns, bond requirements, and whether partial retention of in-kind securities is advisable.

For the governing statutes and probate processes, review South Dakota’s probate code (Title 29A): South Dakota Codified Laws (search / Title 29A).

Helpful Hints

• Order multiple certified death certificates right away — brokerages, banks, and government agencies all ask for originals.
• Open the estate checking account as soon as you have the Letters from the probate court — you will need a place to deposit proceeds and pay expenses.
• Ask the brokerage for a written checklist or packet for probate transfers — it speeds processing.
• Get an Employer Identification Number (EIN) for the estate from the IRS (online) before requesting transfers or depositing funds.
• If the account has a designated beneficiary or joint owner, request written confirmation from the brokerage showing how they will handle the transfer to avoid surprises later.
• Keep careful, dated records of every communication with the brokerage and copies of every document you submit.
• If selling securities to fund the estate checking account, consider market conditions and whether immediate sale is necessary to pay claims.
• Keep estate funds separate from your personal funds — commingling can create personal liability for the representative.
• Contact the county probate clerk’s office if you need local filing steps, forms, or court contact info.
• When in doubt about duties or disputes, consult a probate attorney in South Dakota to reduce the risk of personal liability.