When you agree to Betterment's ACATS terms and conditions, you are doing the following:
You direct the Sending Account, or delivering firm, to:
- Transfer your assets to Betterment as you have instructed, even though the destination account may have a different account title or different taxpayer identification number than the delivering account.
- Deduct any outstanding fees from the credit balance in your account. If a credit balance does not exist or does not cover the balance due, liquidate assets in the account to the extent necessary to satisfy the balance due.
- Freeze your account when this transfer is validated, which includes canceling all open orders and not accepting new orders on the transferring account (except for transactions closing option positions that expire within seven days).
- Release any requested historical information to Betterment about the assets you’re transferring, including cost basis information.
- Please note, we can only accept cost basis information directly from your previous firm. Contact your previous firm and ask them to send your cost basis to Betterment through the Cost Basis Reporting Service (CBRS). If your previous firm cannot send your cost basis through the CBRS, have them email your cost basis to firstname.lastname@example.org (note that email will take longer for us to update your cost basis).
- Transfer any physical certificates in good deliverable form, including any necessary tax waivers.
Betterment does not support ACATS transfers outbound to other financial institutions.
You acknowledge and accept that:
- Any assets not readily transferable might not be transferred within the time frames set by FINRA (e.g., by FINRA Rule 11870) or other applicable authorities. Additionally, in certain cases, transfers may fail. This may delay the completion of your transfer beyond the estimated date originally provided to you when you initiated the transfer.
- Betterment is not responsible for changes in the value of assets that may occur during the transfer process.
- You understand and accept any tax or financial implications that may arise in connection with this transfer and with the sale or liquidation of any assets, including any wash sales, as well as applicable penalties or charges imposed by the delivering firm.
- You have considered whether any required minimum distributions (RMDs) are necessary if you are retired or of retirement age.
- You acknowledge that in order for Betterment to receive transferred assets, Betterment uses third-party market data to assign a profile to transferred securities based on asset class. You acknowledge and accept that Betterment is not responsible for the accuracy of third-party data or verifying the underlying characteristics of transferred securities. Any inaccuracies may impact Betterment’s management of your portfolio.
- In the case of mutual funds, single stocks and other security types to which Betterment is unable to assign a profile, unless you have requested and Betterment has confirmed that it will not sell the securities, you acknowledge that Betterment will, in its discretion, sell such securities immediately and use the proceeds to purchase new securities consistent with your goal’s target allocation. You further acknowledge and accept that such transactions may have tax implications.
- In the case of transferred securities to which Betterment is able to assign a profile, Betterment will endeavor to manage the transferred securities as a part of your portfolio consistent with your investment strategy. You acknowledge and agree that Betterment will make a good faith effort at assigning a security to a particular asset class that is consistent with the security’s underlying characteristics but does not guarantee the accuracy of such categorization. You further understand and acknowledge that the effectiveness of Betterment’s management of your portfolio according to your risk preferences (including but not limited to Betterment’s rebalancing feature) may be impacted if the profile Betterment has assigned your transferred securities is not consistent with its underlying characteristics.
- Rebalancing transactions may occur unless you have requested, and Betterment has confirmed, that rebalancing is disabled in your receiving account. You understand that rebalancing transactions may result in the purchase and/or sale of securities in accordance with your investment strategy. You understand that if a transferred security can be sold to reduce drift in a tax-efficient manner consistent with your goals, rebalancing transactions prioritize the sale of transferred securities over securities that Betterment regularly purchases for client accounts.
- You understand that certain mutual funds may assess sales fees (“back-end loads”) at the time Betterment determines to sell them. Betterment does not consider any such fees in its financial advice regarding transferred assets and does not incorporate those fees into performance information about your portfolio.
- You understand that any mutual funds that are transferred to your Betterment account and not sold immediately may result in delayed transaction times and reduced tax loss harvesting efficiency.
- You have not received tax advice from Betterment and Betterment is not responsible for the tax consequences of this transfer or any associated sales. You should consult a tax advisor if you have any questions about your personal tax situation.
- If an account transfers to Betterment with a debit balance, you are responsible for satisfying the debit balance.
- To the extent that you are transferring all of the assets you hold at a firm, you affirm that you have destroyed or returned any credit/debit cards and/or unused checks associated with the account.
- If the assets you are transferring to Betterment lack cost-basis information, either because your previous firm fails to provide Betterment cost basis information for the transferred securities or the transferred securities were purchased prior to January 1, 2012 (for ETFs and mutual funds), the assets will be assigned a cost-basis in our system of “$0” or “Unavailable”. The functionality of any Betterment feature that relies on cost-basis information, including but not limited to rebalancing, tax loss harvesting (TLH), and tax coordinated portfolios (TCP), is impacted when your account contains securities with unavailable cost-basis information. To review whether we have cost basis information for your transferred securities, you can download your cost basis file from your account “Documents” tab, under Documents > Taxes > Cost basis > Download CSV cost basis report.
You agree to indemnify and hold harmless Betterment and its affiliates (collectively, “Betterment”) from and against any liability incurred by Betterment for relying in good faith upon your transfer authorization.