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New York State Unclaimed Property: Laws, Rules & Time Limits

unclaimed funds

New York State’s Abandoned Property Law requires property abandoned with companies and state agencies, to be handed over to the Comptroller of the State in certain circumstances.  For businesses, this mainly refers to uncashed creditor and payroll checks and deposits.  And in the case of financial institutions, cash, and securities.

unclaimed funds

The period after which property is considered abandoned differs depending on the type of property, but is generally within 2 – 5 years of no activity.  There are severe penalties for failing to follow up on, report on, and hand over such property.  So, business owners need to be aware of the regulations to follow.

Owner notification requirements

At least 90 days before August 1 i.e., the required reporting date, notice must be sent via first-class mail to the apparent owner of the abandoned property.  (Unless there is no known address or the address is known not to be current.)

Where the property is valued over $1000, and no response is received to the first notice (and where the notice has not been returned as undeliverable), another notice must be sent by certified mail, return receipt requested, a minimum of 60 days before the applicable reporting date.

Comptroller reporting requirements

Where organizations have property that has escheated to the State because of a presumption of abandonment, they must complete prescribed forms and submit them to the New York State Comptroller by August 1.  Reports need to list property held as of July 1, except for financial institutions, which must report holdings as of June 30.

Businesses must also publish the names of the owners within 30 days of reporting to the Comptroller.  And they are obliged to keep records for a further five years (ten in the case of brokers and dealers).

Property handover requirements

In practice, property is usually delivered to the Comptroller at the time of reporting, but deadlines are as follows:

  • Financial organizations by November 10
  • Utilities by October 10
  • Corporations by February 10

Penalties

The Comptroller can levy a fine of $100 a day for reports willfully withheld or delayed, or incorrectly submitted.  Interest at 10% per annum can be charged on the late delivery of property.

Claims

Once property has been delivered to the State, the onus is on the owner to recover it from the State.  Property is listed on the Comptroller’s website, and claims can be made online.  In the event of a claim being denied, it may be resubmitted four months later.  If denied again, the claim can be submitted for review to the Supreme Court, Albany County, provided the Comptroller receives ten days advance notice.

With so many states being short of funds, unclaimed property audits are happening increasingly.  New York, and others, offer voluntary disclosure programs for organizations in default of compliance regulations.  You can find everything you need to know about unclaimed property at the New York State Comptroller’s website http://osc.state.ny.us/ouf/index.htm.

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