There are billions of dollars in lost funds and property floating around the United States. It includes forgotten checking and savings accounts, security deposits, uncashed paychecks, stocks, FHA mortgage insurance refunds, customer overpayments and even tax refunds from the IRS.
If the rightful owner can't be located, the property or funds are turned over to the state for safekeeping. You can find unclaimed money through your state's treasury department.
1. Search the Government Databases
Many people have forgotten about money from a former bank account or a 401(k) from a previous employer. The companies are required to report this dormant money to the state, which holds the funds until claimed by the owner. New York, for example, returns more than $1 million every day to residents searching its database of lost funds. Ward warns against "treasure hunters" who contact people out of the blue and offer to search for unclaimed money on their behalf — usually for a fee. Instead, he recommends a free online search at the state websites. The searches are easy to navigate.
2. Search the Private Databases
Often, people forget to update their records or close accounts when they change addresses. Other times, heirs fail to locate all accounts of a deceased relative. When this happens, the money often ends up with the state treasury office. The National Association of Unclaimed Property Administrators says more than $4 billion in funds are returned each year to rightful owners. How to recover my lost funds
If you find funds that belong to you or a loved one, follow the instructions of the fiduciary holding those funds to learn how to claim them. Ward warns against paying a "finder" company to search for lost assets, as these firms may charge hefty fees and take a cut of your money. Instead, he suggests searching for forgotten property on your own using your state's website.
3. Search the Abandoned Property Database
According to the National Association of Unclaimed Property Administrators, in 2006 alone, state agencies paid 1.9 million claims to owners totaling $1.7 billion. Unfortunately, a large percentage of the money collected by these agencies never makes it to the rightful owners. The good news is that it's not hard to get your share of this bounty; all you need is a last name and the state in which you lived when the account was created or abandoned (and maybe a few other details such as your age, gender and address).
The pool of money that has been turned over to the states includes forgotten checking or savings accounts, stock account dividends, utility company security deposits, insurance premium refund checks, escrow balances, gift cards with unused balances, and even 401(k) and IRA funds. The state will keep the money until it is claimed, at which time the owner can choose to receive it as a cash payout or convert it into a tax-deferred investment through an annuity or similar product.
The best way to stay off the list of unclaimed assets is by keeping your accounts active and cashing checks promptly, advising financial institutions when you move and maintaining accurate records, Schantz says. It's also worth looking into the lists of any other states you've moved to, especially if you're a transient. Just be wary of companies that offer to search for you; they may be a scam. In any case, reclaiming your money will require some effort on your part and you'll need to follow each state's recovery procedures.
4. Contact the Office of Unclaimed Funds
Billions of dollars are sitting in unclaimed property accounts at state governments and treasuries across the country. While each state's laws and procedures are different, most have some common themes. Banks, insurance companies, utilities, corporations, courts and other entities report uncashed payroll checks, inactive stock accounts, utility deposit refunds and stock dividends to the state when they can't locate the owners. The money is then turned over to the state for safekeeping. The State Comptroller's Office maintains an online searchable database of lost funds, and the state reclaims more than $1 million every day.
The process for claiming these assets and money is relatively straightforward. Individuals can visit the state websites of their respective states to find out more about how to make a claim. The websites also often have links to third-party searchable databases. Individuals should know that their claims are usually tax-free, though they should consult with an accountant before filing a claim to ensure they're following all the appropriate guidelines.
In addition to the online searchable databases, each state's unclaimed property department typically has offices that can be contacted for more information. Typically, these offices are staffed by experienced, knowledgeable individuals who can answer questions about the specifics of each state's unclaimed property laws. Additionally, many of these departments offer educational workshops and seminars to help businesses learn more about state-specific requirements for identifying and reporting unclaimed property.
If you're a business owner, it's important to keep up with these requirements. Through analytic reviews, annual reporting, audit defense, VDA assistance and more, Clearview Group can help you achieve compliance with state-mandated unclaimed property laws to avoid fines.
Keeping track of your personal and business assets is the best way to prevent them from becoming abandoned property. However, most of us get disorganized at one point or another, and that's how money can end up in the unclaimed property trough. A check may get shoved in a drawer, or a company might lose contact with an employee who moves to a new location without registering a forwarding address. Then there are the unfortunate circumstances where people die and their heirs don't file a claim.
Comments
Post a Comment