Unclaimed Property Reporting: An Often Missed Filing Requirement

What is unclaimed property? We’re glad you asked because most businesses are unaware of the unclaimed property reporting requirements. The Texas Comptroller defines unclaimed property as any financial asset or contents of a safe deposit box that have been abandoned by the property owner for one to 15 years. In Texas, you are considered a “holder” if you operate as a business or government entity and are in custody of assets belonging to another person or entity that have been abandoned for at least a year.

Abandonment Period

First, you must determine if the property is abandoned. The first step is to figure out if you have had communication or transacted business with the property owner during the abandonment period. There are different abandonment periods for different types of property. You can find a quick reference chart here

An attempt must be made to return the property to the owner by sending a due diligence notice alerting them that their property will be reported if it goes unclaimed.  If the owner does not claim the property, then you likely have a requirement to file a report and turn the property over to the State.

Examples of Unclaimed Property

  • Abandoned bank accounts
  • Uncashed checks
  • Over payments
  • Payroll and vendor checks
  • Unredeemed gift cards
  • Insurance proceeds
  • Dividends
  • Mineral interests

2020 Unclaimed Property Deadlines

March 1 Annual cutoff date for required abandonment periods
June 30Annual cutoff date for life insurance
July 1Deadline for holders to file a report and remit unclaimed property.  Property may be remitted any time after the March annual cutoff date.
Nov 1Deadline for filing life insurance reports and remitting property

The Process

  • Verify that the property has surpassed the abandonment period.
  • Notify property owners about the abandoned property.  A written notice must be mailed by May 1 for any property exceeding $250.
  • Prepare and submit the unclaimed property report by July 1 using the transfer portal on ClaimItTexas.org
  • Remit the property to the State utilizing the guidelines established for the specific type of property. 
  • Lastly, maintain all unclaimed property data for at least 10 years, as required by the State of Texas.

Additional information can be found at www.claimittexas.org or www.comptroller.texas.gov/programs/unclaimed.

Other States

Almost all states have some type of unclaimed property laws. The abandonment periods, notification procedures and reporting requirements vary by state. If you are doing business in other states, be sure to check their state laws regarding unclaimed property.

Claiming Your Property

Is it possible that you are the owner of property that hasn’t been claimed?  It never hurts to check. Visit the Texas Unclaimed Property website to find out.

Ernesto Aguilar is a tax professional with ATKG. He holds a Bachelor of Business Administration from the University of the Incarnate Word and a Master of Business Administration from Texas A&M University-San Antonio. Contact your ATKG tax advisor at 210.733.6611 or info@atkgcpa.com for assistance in easing the burden of unclaimed property reporting and due diligence.