Switching Brokers: Avoid Fees and Tax Surprises

The not-so-secret Wall Street trick when you switch brokers

Pros don’t just click “transfer” and pray. They negotiate, sequence, and paper-trail the move. The transfer itself isn’t the risk, timing and tax breadcrumbs are. When I’ve moved seven-figure books, I’ve asked for transfer credits up front, staged trades to avoid wash sales, and locked in temporary fee waivers. That’s the playbook. You’ll learn how to ask for ACAT credits the way pros do, what calendar traps actually cost you money, and what’s different right now in 2025.

Why pros ask for ACAT transfer credits up front (and how you actually get them)

• Lead with assets and intent. Send your most recent statement (redact account numbers) and state the dollar amount you’ll bring over. Pros literally say: “I’m transferring $500k in taxable and $300k in IRA. What’s your transfer credit and will you reimburse ACAT-out fees?”
• Get it in writing. Ask for a secure message noting the credit amount, funding deadline, holding period (usually 90-180 days), and which products count (ETFs yes, private placements often no).
• Ask for the small stuff. Temporary waivers on wire fees, option assignment/exercise fees, and ticket charges for the first 60-90 days. Not sexy, but it adds up.

Data point: As of Q4 2025, public transfer promotions are back: tiered credits commonly range from $200-$1,000 on ~$50k-$250k transfers and can reach $2,500-$5,000 at $1-$2 million+. ACAT-out fees run about $50-$125 per account at many mainstream brokers. Your mileage will vary, but that’s the real ballpark I’m seeing. And yes, confirm the payout timeline, some pay within 1-2 weeks of asset arrival; others wait 60 days.

The real risk isn’t the move, it’s dividend dates, wash sales, and missing cost basis

1. Dividend and capital-gains timing: Ex-dividend dates matter. If you sell the day after ex-date, you still owe the dividend and the price usually drops by that amount. In Q4, mutual funds spit out capital-gains distributions; buying right before those can hand you a taxable check for gains you never enjoyed. That’s… annoying.
2. Wash sales: The 30-day rule disallows losses if you buy a “substantially identical” security 30 days before or after you sell at a loss. Sequence sales at Old Broker, wait, then rebuy at New Broker, or use a not-substantially-identical proxy ETF for the gap.
3. Cost basis transfer: Ask the new firm to request complete covered and noncovered basis via ACATS, then verify lots against your records. Keep PDFs of every lot you care about. If basis arrives blank (it happens), you’ll spend January chasing edits when you’d rather be watching bowl games.

Quick over-explanation: “Ex-dividend” just means the stock is trading without the right to the upcoming dividend. If the dividend is $0.50, price often drops about $0.50 on the ex-date. So you didn’t lose value, it got swapped for cash. Now, the point: don’t let that swap land in the wrong tax year or the wrong account.

What’s different right now in 2025

• Promo dollars are back, but terms are stricter, hold periods and product exclusions are tighter, and some desks require householding to hit top tiers.
• ACAT-out schedules got tighter, with more brokers charging the high end of that $50-$125 range and limiting partial transfers for free. Watch IRA termination fees too.
• Market calendar risk is elevated in Q4: year-end mutual fund distributions, special dividends, and tax-loss harvesting season all collide. The sequencing matters more than usual right now.

One honesty note: our quick pass on the provided research query (switching-brokers-avoid-fees-and-tax-surprises) didn’t return standardized SERP stats to quote, and promos change weekly. I’m giving you my current read from live offers we’re seeing across desks, but always screenshot terms and save the secure message. My take? If you prep the credits, plan your ex-dates, and document cost basis, the transfer is the easy part. The sloppy timing, that’s what costs real money. Don’t do that:)

Fee booby traps: what to check before you click ‘transfer’

Quick reality check for Q4 2025: the ACAT pipe is running fine, but the fees around it got spikier this year. ACAT-out charges are routinely posted at $50-$125 per account (yes, per account, not per household), and I’m seeing more custodians push to the top end. That part you probably expected. What people miss is the stack: closeout fees, IRA annuals that hit in December, paper statement junk, even inactivity fees, timing matters because if you trip the charge before the assets leave, you’ll pay it and then fight for a credit. Been there, not fun.

How I map it with clients, super basic but it works:

• ACAT-out fee: Log the exact dollar number per account. Screenshot the fee schedule with a 2025 date stamp. If your new broker is promising to reimburse, get it in writing in secure message with the amount cap and deadline to submit your proof.
• Close vs. partial transfer: Some firms add an extra “termination” fee only when the account balance goes to $0. If a partial ACAT is free but a full close costs more, leave $10 cash till the reimbursement clears, then ask the new broker to journal or mail the remainder. Sounds silly, but it avoids a surprise $75 termination line item.
• Account-level traps: Annual IRA custodial fees, paper statement fees, and inactivity fees are still on several 2025 schedules. If those bill monthly or quarterly, close or switch to e-delivery before the billing cycle hits. I’ve seen $5-$10 for paper, and IRA annuals vary widely, check the current PDF, don’t assume.
• Mutual funds and loads: If your fund isn’t “ACAT-transferable” at the target custodian, you may need to sell. That can trigger a load or a transaction fee, and in Q4 you’ve also got year-end capital gain distributions. Check ex-dates and whether your share class is supported in-kind. If not, consider moving cash equivalents first, then decide on funds post-distribution.
• Margin interest clock: Interest accrues until the debit is paid or transferred. With T+1 settlement (in place since 2024), sales free up faster, but the meter runs daily. Either ACAT the debit alongside the positions or square it before the transfer date to avoid a stray week of interest.
• Employer stock plans / RSUs: ESPP/RSU-linked accounts often can’t ACAT directly. If you must liquidate inside the plan, expect sell commissions and possibly plan admin fees. Also watch blackout windows in Q4, don’t box yourself into selling on a thin day.

Pro tip: Ask the new broker to pre-approve a “transfer concierge” note: ACAT-out reimbursement up to $125 per account, closeout fees included, claim must be submitted within 30 days. Then submit the final statement showing the fee. No note, no guaranteed credit.

Two more timing notes for right now: markets are choppy into year-end distributions and tax-loss harvesting, so price slippage on forced fund sales is real, and special dividends can flip a cost basis lot from long to short on you if you’re not watching. If you’re juggling multiple accounts, sequence IRAs first (no capital gains headaches), then taxable once you’ve mapped distributions and ex-dates, sorry, I should’ve said that earlier. And yes, keep a tiny cash buffer for postage-y charges; it avoids auto-liquidations that create a Form 1099 mess in January.

ACATS mechanics in plain English: timeline, sequencing, and what can break

Here’s how the Automated Customer Account Transfer Service behaves in the real world right now in Q4. If you request a partial transfer (you choose the positions), expect about 1-3 business days once the delivering broker approves. A full account transfer typically lands in ~3-6 business days. Add a few days if you’ve got illiquid bonds, non-standard options, or mutual funds that need extra share class mapping. The ACATS clock has two parts: day 0-1 is the “validation” (old broker says yes/no and locks positions), then the assets move on the standard cycle. That lock is why you can’t trade those particular positions mid-transfer unless both firms allow it (most don’t).

What moves cleanly right now:

• Listed stocks and ETFs on NYSE/Nasdaq, bread and butter, usually seamless.
• Mutual funds that are NSCC-eligible (i.e., both firms can hold and process that exact CUSIP and share class). If it’s the same share class at both firms, this is usually fine.

What doesn’t (or stalls):

• Proprietary funds (e.g., firm-only money market or house-brand mutual funds). These often require liquidating to cash.
• Certain alternatives (non-traded REITs/BDCs, interval funds) and annuities, expect extra forms or a non-ACATS transfer. Paperwork purgatory is real.
• Some crypto. Brokerage-held crypto or “crypto sub-accounts” usually can’t ACAT; brokers sell to cash first. Crypto ETPs/ETFs are fine.

Sequencing tips so you don’t chase loose ends:

1. Turn off DRIP a few days before you initiate. New fractional drips create stray lots that don’t ACAT and will lag as residuals.
2. Fractional shares usually don’t ACAT; delivering broker sells the fraction and sends cash. Heads-up on tax lots: that sale can realize short or long gains unexpectedly.
3. Open orders (GTC/stop limits) get canceled at most brokers when validation starts. Re-enter after the transfer lands.
4. Corporate actions in-flight, splits, mergers, tender offers, can freeze positions until the action settles. If you know one’s pending, wait until it’s done. It’s the one time “hurry up and wait” actually saves time.

Residuals: dividends and interest that accrue at the old broker arrive after the main transfer as “residual sweeps.” Leave the delivering account open for 1-2 cycles (roughly one to two statement periods) to catch them. I keep a post-it on my monitor so I remember to check; saves me from the “where’d that $12.84 go?” routine.

Q4 timing quirks you’ll feel this year: U.S. markets are closed Nov 27, 2025 (Thanksgiving) and Dec 25, 2025 (Christmas), with an early close at 1:00 p.m. ET on Nov 28. Holiday staffing and year-end fund distributions can stretch a 3-day move into 5-6. If you’re tax-loss harvesting, try to initiate after key ex-dates or you’ll inherit dividend adjustments mid-transfer. And yeah, markets are still choppy into year-end distributions, so I pad timelines by a day; no heroics needed.

Pro tip: If you must move before a known corporate action, consider a partial ACAT of the clean positions now, leave the messy ones to settle, then a second sweep. It’s not elegant, but it’s faster overall.

Last practical thing: if you want the account fully closed, explicitly check “full transfer & close.” Otherwise the shell lingers, which is fine during residuals, but annoying later. Kinda learned that the hard way in my own IRA last year, two stray cents kept the account alive for weeks.

Taxes people miss when moving: wash sales, cost basis, and year-end timing

This is the graveyard of clean intentions. You move an account in December, markets wobble (they are wobbling again this year with rates sticky and small caps still jumpy), you harvest a loss, and, boom, your April shows up with a surprise. Seen it a hundred times, did it to myself once during a caffeine-fueled rebalance years ago. Here’s where DIY transfers go sideways.

• Wash sale rule is account-agnostic. The 30-day window before/after a loss sale applies across all your accounts: old broker, new broker, spouse’s taxable, even your IRA. If you sell XYZ at a loss on Dec 10 at Broker A and your DRIP at Broker B buys XYZ on Dec 15, you’ve got a wash sale. The loss is disallowed and the basis gets added to the replacement shares. Yes, it’s annoying. It’s the rule.
• Turn off DRIP before harvesting losses. Disable automatic reinvestment on the positions you might tax-loss harvest at every broker. A 0.7% dividend reinvested for $18 can nuke a $2,300 harvested loss. I’ve literally watched clients do everything right, except the last toggle.
• Cost basis reporting is real, but not perfect. By regulation, brokers must track “covered” lots for equities acquired on/after Jan 1, 2011; mutual funds/DRIPs from 2012; and certain fixed income/options from 2014. Short version: 2011+ stock lots should move with full lot detail. Reality: mismaps happen in transfers, average? No universal stat, but I see lot-level issues in maybe 1 out of 10 transfers around the holidays when ops teams are slammed. Verify symbol-by-symbol that acquisition dates, quantities, and adjustments (splits, return of capital) survived the trip.
• Holding periods don’t reset on transfer. A proper ACAT keeps your original purchase dates. If you see a long-term lot flagged as short-term after the move, it’s a data problem, not tax law. Fix it now; waiting until March will waste hours while you’re chasing a corrected 1099-B.
• Dividends and capital gains distributions. Qualified dividends need a 61-day holding period within the 121-day window around the ex-date (it’s 90 days for certain preferreds). If you buy right before an ex-date to “capture” a dividend during a transfer shuffle, and then sell shortly after, you can turn what you thought was qualified into non-qualified. In Q4, funds spit out cap-gain distributions too. Those are taxable in the year paid if you hold on the record date, transfer mid-stream and you can still get the tax without the long-term hold you expected.
• 1099 timing and corrections. Brokers generally issue consolidated 1099s by mid-February. Corrected forms are common in March and even April when funds update reclassification data (qualified vs non-qualified, foreign tax, ROC). Expect at least one correction if you hold mutual funds, REITs, or international ETFs. My personal routine: don’t file until at least the second week of March unless you love amended returns.
• Options during a transfer. Decide: close or transfer. Open short options can get assigned while assets are mid-ACAT, which creates messy basis and holding period records split across two brokers. If you must transfer, consider moving the entire option chain, and keep cash available for unexpected assignment. Otherwise, close first, then move the underlying stock later.

Quick checklist (holiday edition):

1. Pause DRIPs on target harvest names at all accounts before you sell.
2. Confirm lot-by-lot cost basis moved (check 2011+ equity lots, 2012+ mutual fund lots).
3. Watch ex-dates: qualified dividend clock = 61 days in a 121-day window.
4. Don’t panic-file taxes. Mid-Feb 1099 is normal; March corrections are normal-er.
5. For options, avoid transferring right into expiration week. Been there, don’t.

One more thing, I know it’s tempting to harvest losses into a “similar but not substantially identical” ETF and call it a day. That’s generally the right move, but definitions get hairy with index methodology overlap. Broad S&P 500 vs total market has been fine historically; two funds tracking the same narrow index? Risky. And if you forget to turn off the old DRIP on the fund you sold, well, we’re back to square one.

Bottom line: in Q4 2025, with volatility popping around Fed speak and year-end distributions, assume transfers take an extra day or two and babysit the tax details. It’s boring. It’s also the part that saves you real dollars in April.

Retirement accounts and rollovers: keep the tax man out of your IRA/401(k)

Moving tax-advantaged money isn’t hard, it’s just unforgiving. When you switch custodians in 2025, the clean move is a trustee-to-trustee transfer. That’s the direct handoff: your old IRA or 401(k) sends assets straight to the new shop, you never touch the cash, no 1099-R taxable mess. It sidesteps the 60-day clock, the one-rollover-per-12-months headache, all of it. Nine times out of ten, this is the answer.

About that 60-day rollover: if a check is made out to you and you redeposit it within 60 days, it can be non-taxable. But miss day 60, by one business day, and the IRS treats it as a distribution. If you’re under 59½, expect the 10% early distribution penalty on top of ordinary income tax. Also, for IRAs, you only get one indirect rollover per 12 months across all your IRAs combined (traditional and Roth), per IRS rules. The limit doesn’t apply to trustee-to-trustee transfers or to rollovers from 401(k)s to IRAs, but it trashes a lot of well-meaning DIY moves. I’ve seen careful folks trip it just by moving small Roth IRAs between banks in the same year, one too many envelopes and, boom, tax.

RMDs: if you’re 73 or older this year, you have a 2025 required minimum distribution. You can’t roll an RMD. The plan or IRA must pay out the RMD to you first, then you transfer the remainder. If you do a full transfer before the RMD comes out, custodians can flag the whole thing, and you’ll be untangling it with 1099s in March (ask me how that week went for a client in 2022…). Also worth noting: the missed-RMD excise tax was cut by SECURE 2.0 to 25%, and 10% if corrected in a timely manner, but that’s still an ugly, avoidable fee.

Backdoor Roth fans, quick caution. The pro‑rata rule counts all your end-of-year pre‑tax IRA money in the conversion tax math. If you transfer pre-tax IRA dollars into the same year you plan to convert after-tax dollars, you’ll inflate the taxable portion. The usual fix is to roll pre-tax IRA money into an active 401(k) before December 31, then do the backdoor. Don’t do it backward; you’ll hate the April surprise. And yes, we’ll hit HSAs in a minute even though I haven’t brought them up yet.

401(k) to IRA vs. 401(k) to a new 401(k) is a live decision in Q4: markets are choppy into year-end distributions and you want control, but weigh:

• Creditor protection: ERISA 401(k)s generally have stronger, near-unlimited federal protection from creditors; IRAs rely on state rules (often protected, but limits vary). If asset protection matters, a new 401(k) can be better.
• Loans: 401(k)s can allow participant loans. IRAs can’t. If you may need a short-term bridge (not ideal, but life happens), that feature only exists in plans.
• NUA for company stock: If you hold employer stock in your old 401(k), the Net Unrealized Appreciation strategy can turn embedded gains into long-term capital gains in taxable. Roll that stock to an IRA and NUA is gone, permanently.
• Fees and share classes: Some old 401(k)s are actually cheap. It’s common to see institutional index funds at 0.02%-0.04% expense ratios, while the retail IRA equivalent might run 0.03%-0.10%. Target-date funds in big plans often land near the low-0.30%s; many retail target-date mutual funds still sit around 0.40%-0.60%. Compare the all-in cost, fund ER + any admin wrap, before you reflexively roll out.

Practical 2025 notes: year-end is busy. If your old plan withholds 20% on an indirect rollover (standard for eligible plan distributions), you must replace that 20% from cash to keep the whole amount tax-deferred. If you don’t, that withheld piece is taxable income for 2025 and maybe penalized if you’re under 59½. And yes, market moves are jumpy around Fed remarks this quarter, so be careful with in-kind transfers of thinly traded funds; pricing hiccups can delay settlement by a day.

1. Ask for a direct trustee-to-trustee transfer. Names must match; avoid checks to you personally.
2. Avoid 60‑day rollovers unless there’s no other path, and calendar the exact day 60.
3. One‑per‑12‑months rule applies to IRAs for indirect rollovers, don’t accidentally double up.
4. RMD first if you’re 73+ in 2025. RMDs can’t be rolled over.
5. Backdoor Roth: clear pre‑tax IRA balances (often to a 401(k)) before year‑end to avoid pro‑rata pain.
6. Plan vs IRA: weigh ERISA protection, loan features, NUA potential, and all-in fees.

I’ll say it plainly: direct transfers are boring, and that’s perfect. In a year where ops teams are stretched and markets are twitchy, boring is what keeps your retirement dollars out of the tax bucket.

Pro playbook for a clean move: negotiate credits, harvest smart, document everything

This is the exact checklist I run with clients when we’re switching-brokers-avoid-fees-and-tax-surprises season… which, heading into year-end 2025, is basically now. The goal is boring: no surprise fees, no wash-sale headaches, no February 1099-B panic. And yes, we negotiate. A lot.

1. Get it in writing first: Before you initiate anything, ask the new broker for a written ACAT-out reimbursement and any asset-based fee waivers. Most custodians still charge an ACAT-out in the $50-$125 range per account (2024-2025 published fee schedules; not fun, but common). Many receiving firms will credit this back if you ask, especially for $250k+ incoming assets. Also push for 3-12 months of advisory-platform fee waivers if you’re bringing fee-based assets. If it isn’t in writing, it… doesn’t exist.
2. Export cost basis and lot history, before you start the transfer. Download PDFs and CSVs of every holding’s basis, acquisition dates, and lot-level info from the old broker. Take screenshots too in case something goes missing mid-ACAT (it happens). Covered shares should carry over, but I still see noncovered lots drop cost basis. You’ll want statement PDFs for at least the last 2-3 years and the most recent 1099‑B and 1099‑DIV.
3. Know the timing rules (real ones): Under FINRA Rule 11870, the delivering firm has one business day to validate an ACATS request and, once validated, the transfer completes within three business days. In practice, full transfers land in ~3-7 business days, with residual sweeps after trade settles. So plan cash needs ahead, don’t cut it close before a tuition bill.
4. Disable DRIP and auto-invest on all positions 2-3 business days Before initiating the ACAT. Reinvested dividends during transfer create odd lots, tiny residuals, and mismatched basis entries. I know, it feels nit-picky. It saves cleanup later.
5. Tax-loss harvest before initiating and watch the wash-sale clock. The 30-day window applies across all your accounts. If you harvest in taxable, avoid repurchasing a substantially identical security in any account for 30 days before/after the sale. That includes your spouse’s taxable and IRAs. If you’re going to pivot into a proxy or a factor ETF instead, map it now. Circle back to point #2: you’ll need those lot records to document the realized losses cleanly.
6. Time around distributions: Check ex-dates for funds and dividends. Decide intentionally, either capture the dividend (accepting the tax bite) or transfer before the ex-date to avoid buying a distribution. In a year with chunky cap-gain payouts from some active funds (we saw it last year too), getting in front of ex-dates matters.
7. Margin: move it thoughtfully. If you have margin debit, either replicate the margin line with the new broker in advance (get the approval letter and terms) or pay it down pre-transfer. ACATS can move margin, but missing approvals can trigger forced liquidations, worst timing if markets wobble for a week. If you’re using portfolio margin, confirm the receiving broker supports it; not all do.
8. Initiate the ACAT as “full” where possible to reduce residual stragglers. For partials, list CUSIPs and share counts precisely. Double-check any restricted or non-DTC eligible positions, these can stall the clock.
9. After transfer: reconcile immediately, not in February. Match shares, cash, and pending accruals to your exported records. Fix basis discrepancies with the receiving broker’s cost-basis team right away. Covered basis must be correct for the 1099‑B. Noncovered? You’re the recordkeeper; your PDFs/screenshots are your proof. I’ve watched clients wait until 1099 season and, yeah, the queue is brutal.
10. Close the loop: Re-enable DRIP or auto-invest only after you confirm positions and lots. Schedule a second sweep for residuals; they often arrive T+2/T+3 after pending dividends settle. Then archive the final “transfer complete” confirmations with your basis files.

Quick recap of the two places people slip: not getting ACAT credits and fee waivers in writing, and not saving lot-level basis before the move. If you only do those two, you’ve already dodged most of the mess.

One more thing I forgot to mention earlier, cash buffers. If you’re doing year-end harvesting in 2025 and expect estimated tax payments, keep enough cash parked so you’re not selling into a three-day ACATS window. Markets can be twitchy into December, and… well, I’ve seen Christmas-week volatility turn a tidy plan into noise. Keep it boring, keep it documented, and get those credits promised in writing.

If you snooze now, here’s what bites you in Q1

If you snooze now, here’s what bites you in Q1

January is when all the “I’ll handle it later” stuff shows up on statements and tax forms. It’s also when your patience is thinnest. Here’s the short version: fees that post after the transfer, basis that didn’t make the trip, and tax rules you accidentally triggered while moving accounts. The long version… well, it’s below.

• ACAT-out fees and annual charges you can’t reverse: Custodians typically assess ACAT-out fees after the move completes. It’s common to see $50-$125 per account plus stray annual IRA or “maintenance” fees if your account was still open on the fee-billing date. If you don’t have pre-approved credits from the new broker in writing, you’re eating it. I’ve seen folks pay it twice when they split accounts. Painful and totally avoidable.
• Incorrect or missing cost basis tanks your 1099-B: If lot-level basis didn’t transfer, your 1099-B shows “basis not reported.” That means you (or your CPA) rebuild lots, file attachments, and maybe amend later. Brokers can issue corrected 1099s into March, and a corrected form in March can force an amended return you’ll never get that Saturday back for. If I’m oversimplifying, fine… but the time sink is real.
• Wash sale landmines that wipe your 2025 harvest: Sell for a loss in December and accidentally repurchase a “substantially identical” security across accounts within 30 days, your loss is disallowed and added to basis. Translation: your 2025 tax-loss harvest disappears just when you wanted it. In a choppy Q4 (holiday liquidity is thin and spreads can widen), this happens more than people admit.
• Fractional share cleanups become taxable sales: Partial shares often get auto-liquidated during an ACATS. Those pennies-to-dollars per position? They’re sales, with reportable gains/losses on the 1099-B. Not huge dollars, but the reconciliations and mismatched dates make Schedule D messier than it needs to be.
• RMD mistakes = penalties and paperwork: If a transfer-year RMD isn’t satisfied from the right account type or the distribution isn’t coded correctly, you’re looking at an excise tax under IRC §4974. Under SECURE 2.0, the penalty is 25% of the shortfall (reduced to 10% if corrected in the “correction window”). That’s real money, and it’s a form-fest you could have dodged with a one-page checklist and a confirmation email. For 2025 RMDs, just get the custodian to code it right before you move the rest.

Two quick market notes since we’re in Q4 2025: year-end tax-loss selling is active, and liquidity around the holidays tends to be blotchy. If you’re mid-transfer while the market gaps, wash sale timing and partial fills can get weird. And weird equals paperwork.

What happens in Q1 if you ignore this? You’ll see fees you can’t claw back, a 1099-B with missing basis, and maybe a corrected 1099 showing up right when you think you’re done. Then you’re re-filing or amending. Rinse and repeat. I know, I sound grumpy. It’s because I’ve watched perfectly good Januarys vanish into document hunts.

Write down the credits, save the basis, confirm the RMD. If you do those three, you avoid 80% of the nonsense. And yes, I just repeated myself on purpose.

Last small thing: if you promised yourself “I’ll rebuild lots later,” just do it now. Even a quick export from the old broker and a screenshot backup helps. Screenshots have saved me more than once when a corrected form didn’t agree with reality.

Frequently Asked Questions

Q: How do I ask for ACAT transfer credits without sounding pushy?

A: Be direct and specific. Pros lead with assets and intent. Example script: “I’m moving $500k taxable and $300k IRA. What’s your transfer credit, and will you reimburse ACAT-out fees?” Attach your latest statement (redact account numbers). Then get it in writing: secure message noting the dollar credit, the funding deadline, the holding period (90-180 days is common), eligibility (ETFs yes, private placements usually no), and the payout timing. As of Q4 2025, public promos are back: roughly $200-$1,000 for ~$50k-$250k transfers and $2,500-$5,000 at $1-$2 million+. Also ask for temporary waivers: wire fees, option assignment/exercise fees, and ticket charges for the first 60-90 days. And confirm ACAT-out fees at your old shop, $50-$125 per account is the real range I’m seeing. I always lock these in before I hit transfer. Saves headaches and a few hundred bucks, easy.

Q: What’s the difference between transferring in-kind versus selling to cash before I move?

A: In-kind keeps you invested and usually avoids triggering taxes mid-move, you carry positions and cost basis to the new broker. It also avoids being out of the market for a few days. The trade-off: some products may be restricted or not supported (certain mutual funds, alternatives). Selling to cash crystallizes gains/losses immediately (hello taxes), can create wash-sale issues if you rebuy within 30 days, and puts you on the sidelines during ACAT settlement. If dividends are near, remember: if you sell on or after the ex-dividend date, you still get the dividend, and it’s taxable; the stock typically drops by about the dividend on ex-date. Practical approach I use: move IRAs in-kind (no tax drag), and for taxable, move most in-kind and only sell oddballs that the new broker won’t hold, timing around ex-dates and mutual fund year-end distributions.

Q: Is it better to move everything at once or stage the transfer in pieces?

A: It depends on your positions and calendar traps, so there’s a bit of nuance. All-at-once is clean and quicker, and you may hit a higher promo tier right away. But you also risk dividend/cap-gain surprises and wash-sale tripwires if you’re tax-loss harvesting. A staged transfer gives you control: 1) Move IRAs first (no tax landmines). 2) Transfer taxable core positions in-kind. 3) Leave anything with imminent ex-dividend dates or pending mutual fund capital-gain distributions for after they pay. 4) Shift any loss-harvest names only after a 31-day window to avoid wash sales (or temporarily switch to a not-substantially-identical substitute ETF). When I’ve done seven-figure moves, I stage in 2-3 waves over 3-6 weeks, still within the promo’s funding window, and I ask the new broker to count cumulative arrivals toward the same tier, get that in writing.

Q: Should I worry about wash sales and missing cost basis when I switch brokers?

A: Yes, these are the two ways a clean move turns messy. Action list: 1) Before initiating, download realized gain/loss, tax lots, and 1099s from your old broker; export full lot-level basis for each position. 2) Turn off DRIPs and any auto-buys for 31 days before and after you harvest losses to avoid wash sales. 3) If you must stay invested, swap to a similar-but-not-substantially-identical ETF for 31 days. 4) After assets land, verify lot-level basis imported correctly, spot-check against your export; fix gaps via a secure message with documents. 5) Watch year-end traps in Q4: mutual fund capital-gain distributions (often Nov-Dec), qualified dividend holding periods (61-day window), and option exercises/assignments that can surprise you with short-term gains and fees, ask for temporary fee waivers upfront. Quick sanity check: if your new account shows missing basis or an average-cost default on equities, escalate immediately; don’t wait until 1099 season.

@article{switching-brokers-avoid-fees-and-tax-surprises,
    title   = {Switching Brokers: Avoid Fees and Tax Surprises},
    author  = {Beeri Sparks},
    year    = {2025},
    journal = {Bankpointe},
    url     = {https://bankpointe.com/articles/switch-brokers-avoid-fees-taxes/}
}