Understanding the requirements for reporting and remitting different forms of unclaimed property is crucial for compliance, Heather Steffans, a partner of MarketSphere Unclaimed Property Specialists, said May 15.
The length of the period of inactivity after which property is considered abandoned varies by property type and the jurisdiction of remittance, and the reporting date varies depending on an organization's industry classification.
Unclaimed payroll checks generally are to be reported after one year of inactivity. Pay cards are to be treated similarly, Steffans said at the annual American Payroll Association Congress at National Harbor, Md.
“It is still, from a dormancy perspective, a form of payroll,” Steffans said. Activity on the account must be tracked so that it is known when the remaining amount must be reported to the state, she said.
A third-party paycard provider has the ability to monitor account activity in a way that payroll administrators often do not, Steffans said. Organizations and their third-party providers need to clearly outline what happens when the one-year dormancy period has passed. The provider may remit the amount directly to the state, or it may return it to the company, she said.
“You have to look at the relationship that you've got” with a third party provider and determine where the obligation lies, Steffans said. Verifying or updating the contract language to ensure that liability is clearly established may help avoid compliance issues later on, she said.
States may choose to audit an organization at any time for any reason, Steffans said. States may cross-reference reports of compliant organizations with those of others in the same industry to come up with an estimate of the amount and value of unclaimed property that should be reported, based on the company's size, how long it has operated, and other factors.
“Even if you are in compliance, they are going to send you an audit letter” if a report does not follow an expected trend for an industry, Steffans said.
Other activities that may trigger an audit include failing to file a complete report or one that lists an amount different from the remittance amount, she said.
All Bloomberg BNA treatises are available on standing order, which ensures you will always receive the most current edition of the book or supplement of the title you have ordered from Bloomberg BNA’s book division. As soon as a new supplement or edition is published (usually annually) for a title you’ve previously purchased and requested to be placed on standing order, we’ll ship it to you to review for 30 days without any obligation. During this period, you can either (a) honor the invoice and receive a 5% discount (in addition to any other discounts you may qualify for) off the then-current price of the update, plus shipping and handling or (b) return the book(s), in which case, your invoice will be cancelled upon receipt of the book(s). Call us for a prepaid UPS label for your return. It’s as simple and easy as that. Most importantly, standing orders mean you will never have to worry about the timeliness of the information you’re relying on. And, you may discontinue standing orders at any time by contacting us at 1.800.960.1220 or by sending an email to email@example.com.
Put me on standing order at a 5% discount off list price of all future updates, in addition to any other discounts I may quality for. (Returnable within 30 days.)
Notify me when updates are available (No standing order will be created).
This Bloomberg BNA report is available on standing order, which ensures you will all receive the latest edition. This report is updated annually and we will send you the latest edition once it has been published. By signing up for standing order you will never have to worry about the timeliness of the information you need. And, you may discontinue standing orders at any time by contacting us at 1.800.372.1033, option 5, or by sending us an email to firstname.lastname@example.org.
Put me on standing order
Notify me when new releases are available (no standing order will be created)