How to name beneficiaries and fund a trust at Interactive Brokers
Beneficiaries are managed online or by mail. Trust paperwork is taken online
There are two ways to keep your Interactive Brokers investment accounts out of probate: adding beneficiary designations and retitling eligible accounts into a revocable living trust. Which approach works best depends on the account type and your overall estate plan.
With 12 product types, Interactive Brokers offers a range of transfer options. Some investment accounts support Transfer on Death (TOD) designations, others can be retitled into a trust, and some require probate if no beneficiary is designated. The sections below break down each step.
Beneficiary form at Interactive Brokers
IRA Beneficiary Designation (for IRAs), Transfer on Death Agreement (for investment accounts) and Spousal Consent Form.
Open the form →- Choose the beneficiary type: Individual or Legal Entity (a trust, corporation, or guardianship is allowed)
- Choose the association type (Primary Beneficiary or Contingent Beneficiary) and the relationship (Brother, Daughter, Father, Husband, Mother, Other, Sister, Son, or Wife)
- Enter the beneficiary's details and their Percent of Ownership
- Name 1 to 6 Primary beneficiaries whose percentages total 100%; if you also name Contingent (Secondary) beneficiaries, their percentages must separately total 100%
- A minor can be named only if you designate an authorized signer (custodian, trustee, or guardian) for them
- To pay an eligible beneficiary's share to their descendants if they predecease you, click the card icon and configure Per Stirpes
- Pass to any remaining Primary Beneficiaries pro rata, and if none remain, pass to any Contingent Beneficiaries (this is the default)
- Pass directly to any Contingent Beneficiaries and, if none remain, pass to the estate of the (last surviving) account owner; this applies even if one or more Primary Beneficiaries are still living
- If you name no Contingent Beneficiaries, IBKR still requires a rule for a predeceasing Primary Beneficiary's interest: back to the account holder's estate, or to the remaining Primary Beneficiaries
- Click the Transfer on Death Agreement link to open a pre-populated form
- Print it, sign it, and have it notarized; IBKR states the pre-populated agreement "requires formal signature and notarization"
- Submit it to IBKR's New Accounts department using the instructions provided with the form
- When IBKR approves it, your account title is amended to show the designation (for example "Jane Doe, TOD" or "John Doe, TOD Mary Smith") and your statements reflect the new title
- Do not name "my Last Will and Testament" as the beneficiary; IBKR lists it as an unacceptable designation
- Do not use the word "issue" (IBKR rejects it because in its legal sense it includes all lineal descendants, however remote)
- Do not use "or" or "and/or" between beneficiaries; IBKR rejects it as not clearly explaining how assets should be distributed
- Do not cross anything out or alter the form; animals cannot be named
- If a trust is the beneficiary, attach a signed copy of the trust document
- State a percentage for each beneficiary; where more than one is named without percentages, the form provides that they share equally
- Check your marital status in the Certification of Marital Status section (section 3)
Required Documents
- Beneficiary's details and percent of ownership (for an online registration)
- Authorized signer for a minor beneficiary (for a minor). A custodian, trustee, or guardian
- Transfer on Death Agreement, signed and notarized (for a brokerage or eligible joint account)
- IRA Beneficiary Designation form, completed (for an IRA). Signed with a notarized signature or a medallion signature guarantee, by the account owner and the spouse
- Spousal Consent Form, notarized (if married and naming a non-spouse as a primary beneficiary)
- Signed copy of the trust document (on an IRA form naming a trust)
- National identification document (for a non-US resident). It shows the ID number, a photograph, and date of birth
- Revocable Living Trust
- Irrevocable Trust
- Testamentary Trust
- Regulated Retirement Trust (Qualified Retirement Plan)
- Regulated Retirement Trust (Non-Qualified Retirement Plan)
- Other
- IBKR requires a minimum of one Signatory Trustee and one Trader Trustee; a single-trustee trust must have that one person fill both roles
- For each trustee: name, residential address (or principal place of business for an entity trustee), date of birth, and SSN or ID number
- An entity trustee also needs a Tax ID, plus the exchange and symbol if it is publicly traded
- Proof of Trustee Certification: a Trustee Certification Form
- If the trust is not revocable: Proof of ID for the Trustee and Proof of Trustee Address
- If the trust is revocable: Proof of ID for the Grantor/Settlor and Proof of Address for the Grantor/Settlor instead
- Address documents must state the name and address, must not be in an editable format, and several categories (utility bill, bank statement, mortgage statement) must be less than 12 months old
Required Documents
- Trustee Certification Form (for every trust). IBKR lists it in its "Proof of Trustee Certification" category
- Proof of ID for the trustee (if the trust is irrevocable). An individual trustee gives a passport, driver's license, national ID card, or other government-issued ID
- Proof of ID for an entity trustee (if the trust is irrevocable). A business license, certificate of good standing, company charter, bylaws, or operating, partnership or LLC agreement
- Proof of trustee address (if the trust is irrevocable). It must state the name and address and not be in an editable format. A utility bill, bank statement or mortgage statement must be less than 12 months old
- Proof of ID for the grantor or settlor (if the trust is revocable)
- Proof of address for the grantor or settlor (if the trust is revocable). It must state the name and address and not be in an editable format. A utility bill, bank statement or mortgage statement must be less than 12 months old
- Trustee details entered in the application. Name, residential address (principal place of business for an entity trustee), date of birth, and SSN or ID number
- Trust details entered in the application. Type of trust, date the trust was established, and tax or government-issued ID number
- Tax ID of an entity trustee (for an entity trustee). With the exchange and symbol if it is publicly traded
- Settlor or grantor names and ownership percentages. Between 1 and 5 settlors, totaling 100%
- Trust beneficiary information (optional; for an entity trust beneficiary). Contact info, name of trust, article of will, percent ownership, and the date of execution of the trust or will
- Choose the beneficiary type: Individual or Legal Entity (a trust, corporation, or guardianship is allowed)
- Choose the association type (Primary Beneficiary or Contingent Beneficiary) and the relationship (Brother, Daughter, Father, Husband, Mother, Other, Sister, Son, or Wife)
- Enter the beneficiary's details and their Percent of Ownership
- Name 1 to 6 Primary beneficiaries whose percentages total 100%; if you also name Contingent (Secondary) beneficiaries, their percentages must separately total 100%
- A minor can be named only if you designate an authorized signer (custodian, trustee, or guardian) for them
- To pay an eligible beneficiary's share to their descendants if they predecease you, click the card icon and configure Per Stirpes
- Pass to any remaining Primary Beneficiaries pro rata, and if none remain, pass to any Contingent Beneficiaries (this is the default)
- Pass directly to any Contingent Beneficiaries and, if none remain, pass to the estate of the (last surviving) account owner; this applies even if one or more Primary Beneficiaries are still living
- If you name no Contingent Beneficiaries, IBKR still requires a rule for a predeceasing Primary Beneficiary's interest: back to the account holder's estate, or to the remaining Primary Beneficiaries
- Click the Transfer on Death Agreement link to open a pre-populated form
- Print it, sign it, and have it notarized; IBKR states the pre-populated agreement "requires formal signature and notarization"
- Submit it to IBKR's New Accounts department using the instructions provided with the form
- When IBKR approves it, your account title is amended to show the designation (for example "Jane Doe, TOD" or "John Doe, TOD Mary Smith") and your statements reflect the new title
- Do not name "my Last Will and Testament" as the beneficiary; IBKR lists it as an unacceptable designation
- Do not use the word "issue" (IBKR rejects it because in its legal sense it includes all lineal descendants, however remote)
- Do not use "or" or "and/or" between beneficiaries; IBKR rejects it as not clearly explaining how assets should be distributed
- Do not cross anything out or alter the form; animals cannot be named
- If a trust is the beneficiary, attach a signed copy of the trust document
- State a percentage for each beneficiary; where more than one is named without percentages, the form provides that they share equally
- Check your marital status in the Certification of Marital Status section (section 3)
Required Documents
- Beneficiary's details and percent of ownership (for an online registration)
- Authorized signer for a minor beneficiary (for a minor). A custodian, trustee, or guardian
- Transfer on Death Agreement, signed and notarized (for a brokerage or eligible joint account)
- IRA Beneficiary Designation form, completed (for an IRA). Signed with a notarized signature or a medallion signature guarantee, by the account owner and the spouse
- Spousal Consent Form, notarized (if married and naming a non-spouse as a primary beneficiary)
- Signed copy of the trust document (on an IRA form naming a trust)
- National identification document (for a non-US resident). It shows the ID number, a photograph, and date of birth
What Interactive Brokers says about beneficiaries and trusts
Each section is Interactive Brokers's own statement, with the document it comes from numbered under Sources.
Which accounts take a beneficiary6
- Investment account
A Transfer on Death registration is available on US-based individual accounts.1
- Joint account with survivorship
A Transfer on Death registration is available on joint accounts registered as tenants with rights of survivorship or tenants by entirety.1
- IRA
A Transfer on Death registration is available to individual IRA account users.1
- Joint account without survivorship
A Transfer on Death registration is not available on tenants in common accounts.1
- Business account
A Transfer on Death registration is not available on corporate accounts.1
- Custodial account (UTMA/UGMA)
A Transfer on Death registration is not available on UGMA/UTMA accounts.1
Who can be named5
- A person
A beneficiary may be an individual.1
- A trust
A beneficiary may be a legal entity such as a trust.1
- A business
A beneficiary may be a legal entity such as a corporation.1
- An entity other than a trust or a business
A beneficiary may be a legal entity such as a guardianship.1
- A minor
A minor may be named only if an authorized signer is designated.1
How many beneficiaries, and how shares are split
- All accounts
An owner names 1 to 6 primary beneficiaries whose percentages total 100%. Contingent beneficiary percentages must separately total 100%.1
Per Stirpes can be configured for eligible beneficiaries with the card icon on the Account Inheritance page.1
- IRA
Where several IRA beneficiaries are named without percentages, the IRA Beneficiary Designation form provides that they share equally.2
What a designation takes to be effective
Beneficiary forms Interactive Brokers issues3
- IRA Beneficiary Designation
For IRAs. Completed by the account owner. Available to download. Must be notarized.2
Return to
Mailing address: Interactive Brokers LLC, Attn: IRA Services, 209 South LaSalle Street, 10th Floor, Chicago, IL 60604
- Transfer on Death Agreement
For investment accounts. Completed by the account owner. Completed online. Must be notarized.1
- Spousal Consent Form
Available to download. Must be notarized.3
What Interactive Brokers's agreement says about beneficiaries5
- A beneficiary who dies first
The owner chooses one of two rules for a primary beneficiary who dies first. The default passes the share to the remaining primary beneficiaries pro rata, then to any contingent beneficiaries.1
With no contingent beneficiaries named, IBKR still requires a stated rule for a predeceasing primary beneficiary: to the estate, or to the remaining primaries.1
- When a designation takes effect
The online registration alone does not create the TOD. The designation is effective after IBKR receives and approves the signed Transfer on Death Agreement.1
An IRA designation is effective only when filed and accepted by IBKR during the account owner's lifetime.2
- Changing or revoking a designation
A new signed Transfer on Death Agreement is required every time a TOD beneficiary is modified or removed. A TOD revocation must be received and approved by IBKR before the account holder's death to be effective.4
Each new IRA designation revokes every prior one.2
- Divorce
A divorce, annulment, or other legal termination of the marriage automatically revokes an IRA beneficiary designation naming the spouse, whether the spouse was designated by name, by relationship, or both.2
- The institution's right to refuse a designation or an account title
On the IRA Beneficiary Designation form, IBKR does not accept "my Last Will and Testament" as the beneficiary, the word "issue", or "or" and "and/or" between beneficiaries.2
The IRA Beneficiary Designation form must not be crossed out or altered, and animals cannot be named.2
Which accounts a trust can hold2
- Investment account
An existing individual account cannot be converted into a trust account. A separate Trust account is opened and the assets are transferred in.5
- IRA
A dedicated Inherited IRA Trust account type is opened from the same Trust Accounts drop-down, after entering the Retirement Account Type and legal residence. A trust named as an IRA beneficiary receives and holds inherited IRA assets in it.5
What Interactive Brokers says about trust accounts4
- Whether a new account is opened
Holding assets in a trust is an account opening: a new Trust account is opened through a fresh application and the assets are moved across.5
- Who signs for the trust
IBKR requires a minimum of one Signatory Trustee and one Trader Trustee. A single-trustee trust has that one person fill both roles.5
- Review of the trust document
The Revocable Living Trust application asks whether the trust agreement allows the trustee to withdraw and deposit funds to the settlor or grantor and to the beneficiaries.5
- The trust's tax identification number
IBKR asks for the type of trust, the date it was established, and a tax or government-issued ID number for the trust.5
Not in Interactive Brokers's published guidance1
- A full trust agreement or Certificate of Trust requirement
Sources
Data sourced from Interactive Brokers primary sources (18 pages reviewed). How we research.
Download these Interactive Brokers instructions
Download instructions for the whole estateA printable PDF with the steps, required documents, and contact details — verified against Interactive Brokers primary sources. Bring it to the branch or keep it beside the phone.
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