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Trustandwill-Com-Learn-Unclaimed-Property 2

This document discusses unclaimed property, which refers to assets like money, real estate, or paychecks that have gone unclaimed after a period of time set by states, usually around 5 years. It outlines how unclaimed property occurs when owners can't be contacted, explains state laws around claiming this property, and advises creating a will to avoid property being considered unclaimed after death.

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Eric Hazzard
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143 views

Trustandwill-Com-Learn-Unclaimed-Property 2

This document discusses unclaimed property, which refers to assets like money, real estate, or paychecks that have gone unclaimed after a period of time set by states, usually around 5 years. It outlines how unclaimed property occurs when owners can't be contacted, explains state laws around claiming this property, and advises creating a will to avoid property being considered unclaimed after death.

Uploaded by

Eric Hazzard
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PDF, TXT or read online on Scribd
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Unclaimed Property - What You Need to Know


When someone dies, it's possible that they may leave behind unclaimed property.
But what happens to it? Here's what you need to know.

Staff Writer, @Trust&Will


Trust & Will

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Unclaimed property can refer to several situations: a house without a known owner,
an outstanding paycheck, and even an old gift card with leftover money. In an of cial
capacity, unclaimed property is a unique institutional challenge -- and one that leaves
billions of dollars in limbo across the United States. 

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You may be wondering, how does unclaimed property occur on such a large scale?
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And, how is it handled? The following guide will review the various ways unclaimed
property can come about and what can be done
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Allow resolve different situations. Keep
reading to learn about the various guidelines that govern unclaimed property across
the country: 

What does it mean when a property is unclaimed? 


Is it worth it to claim unclaimed property? 
Unclaimed property rules by state
How to avoid unclaimed property with a Will 

What Does It Mean When Property is


Unclaimed?
When property is unclaimed it means that there has been no activity or contact with
the rightful owner for a designated period of time. This time is referred to as a
dormancy period, and once it expires the unclaimed property must be turned over to
the state. The dormancy period in most states is around ve years.  

Unclaimed property can refer to money or assets, and is typically held by a company
or nancial institution. An example of unclaimed property could be as simple as a
refund for a cancelled event, or as valuable as an outstanding life insurance policy. 

The only way to receive unclaimed property once it has been turned over to the state
is by ling a claim. This process often requires numerous supporting documents,
speci cally when claiming property from an Estate. 

Is It Worth It to Claim Unclaimed Property?


It can be worth it to claim unclaimed property, depending on the circumstances and
assets in question. If you never received your security deposit from an old landlord, it
may be easy enough to le a claim and attempt to get your money back. Keep in mind
that unclaimed property is regulated on a state level, and some proceedings can be
more dif cult to navigate than others. 
Unfortunately, a large portion of unclaimed property belongs to now deceased
individuals. In these cases, the next of kin may have a claim to the property. However,
claiming property on behalf of a deceased individual can require a signi cant amount
of time and effort to be approved. Additionally, once approved the property may be
subject to income taxes and other related expenses. 

Is Claiming Unclaimed Property Legal?


It is legal to claim unclaimed property if you are the designated owner or bene ciary.
In order to do so, you will need to provide supporting documentation proving your
identity and relationship to the former property owner. This can be somewhat
challenging; although it is still legal to le as long as you have a legal claim to the
property. 

What Does It Mean When a House is Unclaimed?


When a house is unclaimed, it typically means the bank is unable to get in contact
with the previous owner for the state-determined dormancy period. In these cases,
the house is most likely abandoned and will be repossessed by the bank and
ultimately the state. 

Note that the phrase “unclaimed property” does not exclusively refer to real estate or
houses; there are several common forms of unclaimed property. For example, it can
include paychecks, money orders, refunds, uncashed dividends, annuities, stocks, and
more. In each of these cases, unclaimed means the owner is out of reach and the state
will take ownership of the asset. 

Are Uncashed Checks Unclaimed Property?


Uncashed checks are another example of unclaimed property. Essentially, employers
can determine when an outstanding paycheck has not been cashed. Upon recording
this information, the employee has a responsibility to contact the former employee
until the dormancy period has expired. The employer must then classify the
outstanding paycheck as a liability, and follow the reporting guidelines in that state. 

This type of situation can happen for a number of reasons. For example, an employee
could move out of state and submit an incorrect nal forwarding address. In other
cases, the nal paycheck could be lost in the mail and forgotten about. No matter
what the circumstances are, the employee is entitled to the uncashed wages and can
le a claim accordingly. 

Unclaimed Property Rules by State


The most signi cant determining factor when it comes to claiming unclaimed
property is the state in which the asset is located. Each state has unique laws
governing every aspect of unclaimed property, from contacting owners to approving
eventual claims. 

Several states have laws requiring institutions to contact the rightful owner of
unclaimed property in any instances where the property is valued at more than $50.
These states include Arizona, Missouri, Montana, Nevada, and several more. Other
states, such as Virginia and Alaska, require unclaimed property to be reported when it
is over $100 value. 

The required dormancy period also varies by state. In both California and Colorado,
the dormancy period is one year for outstanding wages and seven years for non-bank
money orders. In contrast, Mississippi has a dormancy period of ve years for wages
and safety deposit contents, while traveler's checks have a dormancy period of 15
years.  

The various differences in regulations can make navigating unclaimed property a


dif cult process, both for recipients and business owners. Overall, the best place to
start when attempting to recoup or report unclaimed property is by reviewing your
state-speci c laws. 

What States Require Negative Reporting for Unclaimed


Property?
Certain states require companies to report a lack of unclaimed property -- through a
process called negative reporting -- annually to demonstrate a continued compliance
with the state’s laws. A few states that require negative reporting include: 

Oregon: Negative reporting is required if the institution has been audited


within the last ve years, or if the company is an active holder of unclaimed
property. 

Connecticut: Negative reports are required if the company is incorporated,


licensed, or physically located in the state of Connecticut. 

Maryland: Required negative reporting from nursing homes, banks, insurance


companies, and utility providers.

Other states, such as Maine or Michigan, do not require negative reporting but
strongly encourage its use. While places such as Mississippi are against negative
reports entirely. Again, the regulations vary dramatically by state so always consult
with the regulations before ling a claim. 

Avoid This Confusion - Create Your Will Today


Did you know that there is roughly $49 billion in unclaimed property across the
United States? This gure cannot be entirely attributed to forgetfulness or even
fractured state regulations. Instead, the amount of unclaimed property is the result of
a combination of factors -- all of which have left individuals across the country
without their rightful property. 

If you are curious how to prevent your loved ones from dealing with this type of
situation, consider writing a Will today. This process will allow you to designate
exactly what will happen to your property upon your death -- and will prevent your
assets from going unclaimed. While it may sound dif cult, this task can help you
protect your loved ones and avoid placing additional responsibilities onto them
during a challenging time.

Unclaimed property can include a number of different asset types, from real estate to
tax returns, but what they each have in common is that they are not helpful when
stalled in regulatory proceedings. One option to avoiding the challenges of unclaimed
property is to create a Will and outline your future wishes.

Is there a question here we didn’t answer? Reach out to us today or Chat with a live
member support representative!

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