Escheat Compliance

Escheat Compliance for Abandoned Property and Unclaimed Property

While you may not have heard of Escheat before, there’s a good chance that you are affected by it on a daily basis. Escheat compliance involves property that has gone unclaimed after a specific period of time.  This property is often referred to as Abandoned Property or Unclaimed Property.   Escheat can apply to many different types of property including uncashed checks, bank accounts, insurance policies and proceeds, rebates, prizes, stocks and bonds to name a few.   Every state in America has its own set of laws regarding escheat, which govern how and when an unclaimed property item becomes part of that state’s treasury. State laws can vary greatly from one state to another other making complying with Escheat laws difficult.

Why you should care about Escheat?

States and municipalities spend millions of dollars each year on escheat programs, which are designed to give back property that has been abandoned. Be careful—if you handle money or property for your business, write checks, award prizes, offer rebates or distribute some form of property, you could end up being responsible for escheat compliance and you would be required to comply with each every state’s laws where property is distributed.

What qualifies as abandoned property subject to escheat?

Unclaimed property, which may include bank accounts, stocks and bonds, insurance policies, payroll checks and utility deposits becomes abandoned when property owners lose contact with those assets. In most states, abandoned property can be turned over to state governments for disposal under a process called escheat. Abandoned property must meet several specific criteria before it qualifies as such.

Where do I find escheat laws and rules for my state?

A state’s escheat law usually falls under its department of revenue or department of financial institutions. The state treasurer may also have escheat rules and resources available on his or her website. You can check each state government’s website for details on their individual programs and laws. Unclaimed property laws exist in most states, with Nevada having one of the oldest and strictest sets of laws governing unclaimed property.  You can find additional information using the links below.

What happens if we don’t comply with unclaimed property laws?

If you fail to comply with unclaimed property laws, you could face a variety of penalties from your state or federal government including fines and even jail time. So, it’s important to know what escheat means and how you can be in compliance. If a business fails to comply with its state’s unclaimed property law, or the laws of a state in which they are required to comply, it can be charged with a crime, which could mean fines or even jail time for an officer or director of that company. A sole proprietor may be personally liable if they fail to comply.

We don’t have a large staff. Can we outsource the escheatment compliance process?

There are certainly advantages to outsourcing your escheatment compliance efforts to a firm that is dedicated to keeping up with any changes in state laws including filing periods, minimum thresholds, due diligence rules, etc. In many cases you could save hundreds, if not thousands, by avoiding any fines or penalties should you fail to comply, If you have a small staff, or if you’re not sure how long your business will remain in operation, you might decide to outsource instead of hiring additional employees.

We help you become and remain compliant with escheat laws.

Contact us about our escheat compliance fulfillment services.  We will provide you with a plan on how to comply with the required state escheatment laws that apply to your program .    Call us today at 1-800-339-0580.

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