I gave my Dad my old Raleigh M600 MTB but I need to install a shorter stem for comfort. I cannot remove the top cap to slide the old stem off. The hex bolt in the top cap spins but it's not coming out. I can see the bottom of the bolt spinning if I look up from the bottom of the steerer tube but that bolt is not backing out.

I don't know if there's a star fangled nut in there or some other kind of retention nut, but I'm guessing the bolt is rusted to it (I don't see rust on it) and the bolt and nut are just spinning in the steerer tube.

What are my options at this point? I'm thinking to either turn the bike upside down and spray some WD40 in there to loosen any crud. Maybe try a long screwdriver to prevent the nut from spinning?

After some more inspection, it looks like the middle of the star fangled nut is stripped. I'm guessing this is my fault or my dads. Anyway, it seems like the only solution is to pound it back out with a dowel and hammer?

You won't get the star fangled nut out by hitting it from underneath. You'll need to drill out the bolt head and punch it out through the bottom of the steerer.

Try loosening the stem bolts and pull the stem up while trying to undue the cap bolt.

My guess is the crimp between the nut and tab rings isn't holding rather than the nut threads stripped. Those are 2 piece with the nut and spring steel gripping rings crimped together. You may be able to pull up and get it to catch as well as some penetrating spray to help the threads. Otherwise probably the fastest and easiest is to drill the head off the bolt and knock the rest down and out. Drilling may be difficult as it has a good chance of spinning with the drill. You could hold it with small vise grips if they can get in there.

Impact guns excel at removing spinning fasteners, fyi. If there's even a little bit of resistance, it should work; if not, you may be able to get enough by smacking the bottom of the crimped tube of the star nut with a punch.

go for a side, star edge, see if you can force the star to turn sideways in the steering tube .

(a typical steel steerer can take this, not alloy (definitely not CF,) _)

We hacksawed off the plastic cap and then pounded the bolt and star nut down and out the bottom of the fork steerer tube. Found a LBS that was open today (shout out to Seabreeze Bicycles in Lewes, DE) and the shop guy installed a new one and also gave us a new spacer and aluminum top cap for $10. We also bought some new front and rear brake pads. All better now.

The nut the bolt threaded into had snapped free of the star nut but was still trapped under the top part of the star so that's why I couldn't pull it out.

Thanks for the ideas.

Recently hah a stripped star nut on a fork at the shop. Took a length of steel rod and pounded it out from the underside of the fork crown. Easy!