An ACATS transfer is the standardized electronic process that moves your stocks, bonds, funds, options, and cash from one brokerage to another without making you sell everything first. It runs through the Automated Customer Account Transfer Service, and once your new broker submits the request, the whole thing typically completes in about six business days.
How an ACATS Transfer Works
The Automated Customer Account Transfer Service is operated by the National Securities Clearing Corporation, a subsidiary of the Depository Trust & Clearing Corporation. The NSCC sits between your old brokerage (the “carrying firm”) and your new one (the “receiving firm”) and processes all the instructions electronically, so the two firms never have to coordinate with each other directly.1DTCC. Automated Customer Account Transfer Service (ACATS) Most brokerage-to-brokerage transfers in the United States move through this system.2FINRA. Customer Account Transfers
You always start at the receiving end. Your new broker generates the paperwork, submits the request through ACATS, and drives the process from there.3Investor.gov. Transferring Your Brokerage Account You don’t call your old broker to close anything; the transfer itself closes a full account when it completes.
What Can and Can’t Transfer In-Kind
Eligible assets include equities, corporate and municipal bonds, unit investment trusts, mutual funds, options, annuities, and cash.1DTCC. Automated Customer Account Transfer Service (ACATS) ETFs move like ordinary equities.
Several things won’t move through ACATS:
- Proprietary mutual funds or money market funds created by your current broker that the receiving firm doesn’t offer.
- Alternative investments such as hedge funds, private equity, non-traded REITs, business development companies, and fund-of-funds structures.
- Limited partnership interests in retail accounts.
- Some foreign securities and baby bonds where proper denominations can’t be obtained.
- Bankrupt issues where the carrying firm can’t deliver proper share denominations and no transfer agent is available.4DTCC. ACATS Alternative Investment Receiver Delete Enhancement
Cryptocurrency held at a brokerage generally cannot transfer in-kind through ACATS. The system’s infrastructure does not currently support direct crypto transfers between firms, so if you hold digital assets and switch brokers, expect to liquidate those positions first.
How to Start an ACATS Transfer
Before you submit anything, gather this from your existing account:
- Your exact account number at the delivering firm
- The account registration type (individual, joint tenants with right of survivorship, IRA, trust, and so on)
- The full legal name of the delivering institution
You’ll use this to complete a Transfer Initiation Form, or TIF, at your new broker. Fill it out carefully. Everything has to match your old account exactly, including your name as it appears on the account, down to middle initials and suffixes. A small discrepancy triggers a rejection.3Investor.gov. Transferring Your Brokerage Account
Full or Partial Transfer
A full transfer moves every eligible asset and cash balance, and the delivering firm closes the account once complete. A partial transfer moves only the specific positions you list on the TIF and leaves the original account open with whatever remains. Partial transfers are useful when you want to keep certain assets at your current broker or when some holdings aren’t eligible for ACATS.
Registration Types Have to Match
The registration on your old account must match the registration on your new one. An IRA can only transfer to another IRA. A joint account can only transfer to another joint account with the same owners. If the registrations don’t align, the carrying firm rejects the request. Open the correct account type at your new broker before you submit the TIF.
The Timeline
Once your new broker submits the TIF through ACATS, the carrying firm has three business days to either validate the transfer or take exception to it. Validation means the carrying firm confirms the account details match and provides the receiving firm with a record of all positions and cash balances.2FINRA. Customer Account Transfers
The actual movement and settlement of assets follows validation. Start to finish, the whole process typically takes about six business days. Rejections or non-transferable assets can stretch that out. Only fully settled assets are eligible, so trades placed in the days before submitting the TIF may still be pending and can hold things up.
What Happens to Your Account During the Transfer
Your account at the delivering firm may be frozen for part of the transfer window. You won’t be able to buy, sell, or make other changes to your positions while it’s frozen, which prevents complications from trades settling while assets are in transit.5Securities and Exchange Commission. Transferring Your Brokerage Account – Tips on Avoiding Delays
This is where timing matters most. If you’re sitting on a position you might need to exit quickly, either sell it before starting the transfer or do a partial transfer that excludes it. Check with both firms before initiating if you expect to trade during the window.
Why Transfers Get Rejected
Most failures trace back to the initial TIF. Common reasons the carrying firm will reject:
- The name on the TIF doesn’t match the delivering account exactly. A missing middle initial or a different suffix is enough.
- An account number is off by even one digit.
- The account has an outstanding margin call or a debit balance that exceeds the equity. The transfer won’t proceed until it’s resolved.
- Pending buy or sell orders haven’t settled.
- The new account’s registration doesn’t match the old one.
When a transfer is rejected, the carrying firm has to notify the receiving firm with the reason. Fixing the issue and resubmitting restarts the clock, so getting the TIF right the first time saves real time.
Fees
ACATS itself doesn’t charge investors anything. The cost comes from the delivering firm, which typically charges an account transfer out fee. At major brokerages these generally fall between $50 and $75, though some firms charge up to $150. The fee usually comes out of the cash balance in your departing account.
Many receiving brokerages will reimburse the transfer fee if you’re bringing over a large enough account. The minimum balance threshold varies by firm and promotion, so ask your new broker about reimbursement before you start. Getting the fee covered is often as simple as requesting it after the transfer completes.
What Happens to Non-Transferable Assets
If a full transfer includes assets that can’t move through ACATS, the carrying firm has to give you options for disposing of those positions. Under FINRA rules, the firm must at least offer the option of liquidating them and must clearly disclose any redemption or liquidation fees that would apply. Those fees are deducted from your cash balance before the remaining cash transfers.6FINRA. FINRA Rules 11870 – Customer Account Transfer Contracts
For retirement accounts, the carrying firm also has to warn you that liquidating certain assets could trigger taxes and penalties. Selling positions inside a traditional IRA to facilitate a transfer doesn’t create a taxable event on its own, since the funds stay inside the IRA. Being forced to take a distribution of a non-transferable asset is a different situation.6FINRA. FINRA Rules 11870 – Customer Account Transfer Contracts
Wash Sale Trap on Forced Liquidations
If you have to sell non-transferable assets in a taxable account, those sales are taxable events. Watch the wash sale rule: if you sell a position at a loss and buy the same or a substantially identical security within 30 days before or after, you can’t claim that loss. This comes up when people liquidate a proprietary mutual fund at the old broker and immediately buy a near-identical fund at the new one.
Cost Basis
Your cost basis is supposed to travel with your assets. For covered securities (generally stocks purchased after 2011 and mutual funds purchased after 2012), the delivering broker has to send the receiving broker a transfer statement within 15 days of the transfer’s settlement date, including each security’s adjusted basis, original acquisition date, and any holding period adjustments.7Internal Revenue Service. Instructions for Form 1099-B
Keep your own records anyway. Download or print your cost basis reports from the delivering firm before you initiate the transfer. Basis data gets lost or garbled more often than you’d expect, and having your own records makes it straightforward to correct errors on your 1099-B.
Stray Dividends and Interest After the Transfer
Dividends, interest, and other credits sometimes arrive at your old account after the transfer has already completed. The carrying firm has to promptly forward transferable assets that accrue to the account afterward. For full account transfers, that obligation runs at least six months, and residual credits must be sent within ten business days of posting.6FINRA. FINRA Rules 11870 – Customer Account Transfer Contracts
A stray dividend or bond interest payment trickling through a few weeks later is normal. If you notice something missing after a couple of months, contact the delivering firm directly.
SIPC Coverage During the Move
Assets at a SIPC-member brokerage are protected up to $500,000 per customer, including a $250,000 limit for cash, if the firm fails financially.8SIPC. What SIPC Protects During a transfer, your assets sit on the books of one firm or the other at any given moment, so the relevant firm’s SIPC coverage applies throughout.
SIPC doesn’t cover every asset. Unregistered digital asset securities are excluded even if held by a member firm.8SIPC. What SIPC Protects SIPC also doesn’t protect against market losses. It only applies if the brokerage itself fails and customer assets go missing.