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Every business that handles money or property entrusted by customers, employees, or clients must follow abandoned property laws. These laws require organizations to turn over assets deemed “abandoned” after a period of inactivity, often referred to as a dormancy period.
From uncashed payroll checks and dormant bank accounts to safe deposit box contents and unreturned utility deposits, businesses across all industries face compliance obligations. Failing to follow these laws can result in steep fines, reputational harm, and even state audits.
This guide provides an overview of abandoned property laws by state, what counts as abandoned property, and how businesses can stay compliant.
What Counts as Abandoned Property?
While terminology varies, abandoned property generally refers to financial or tangible assets that remain unclaimed by their rightful owner for a set period of time. Common examples include:
- Dormant checking and savings accounts
- Uncashed payroll, dividend, or vendor checks
- Customer credit balances and refunds
- Utility deposits
- Gift cards or prepaid balances (in some states)
- Insurance proceeds
- Safe deposit box contents
Key terms:
- Dormancy period: How long property must be inactive before it is considered abandoned.
- Due diligence: Outreach required by the business to attempt to contact the property owner.
- Escheatment: The process of reporting and remitting abandoned property to the state.
Abandoned Property Laws by State
Below is a high-level summary of state abandoned property laws, including dormancy periods and reporting deadlines for some of the most common property types. Always consult legal counsel or state websites for the latest requirements.
* See full Disclaimer below. This information is provided for educational purposes only and should not be relied upon as legal advice.
Trends and Recent Changes
- Shorter dormancy periods: Several states have reduced dormancy periods for accounts and digital assets.
- Digital property expansion: More states include gift cards, crypto, and digital wallets under abandoned property laws.
- Audit frequency: States are conducting more audits, often requiring a 10+ year lookback period.
- Modernized reporting: Many states now mandate online, NAUPA-compliant submissions.
Best Practices for Businesses
- Centralize unclaimed property tracking across all departments.
- Monitor dormancy triggers by state and property type.
- Automate due diligence outreach to owners.
- Keep documentation of communications, reports, and remittances.
- Stay updated on legislative changes.
- Use technology to reduce errors and audit exposure.
How Eisen Helps Businesses Stay Compliant
Eisen’s compliance platform is designed to simplify abandoned property law compliance across all 50 states.
- Escheatment Manager: Centralizes tracking and automates reporting across jurisdictions.
- Outreach Manager: Sends and tracks required owner notices with verified delivery.
- Disbursement Manager: Streamlines remittances while ensuring reconciliation accuracy.
With Eisen, businesses can reduce the risk of penalties and audits, maintain trust, and focus on their core operations.
Conclusion
Abandoned property laws vary widely by state, but one principle holds true everywhere: businesses are responsible for compliance. By building processes around dormancy monitoring, owner outreach, and state reporting, you can safeguard your organization against regulatory risk.
With the right partner, abandoned property compliance becomes less of a burden and more of an opportunity to build lasting trust.
Disclaimer
The information shared in this document is intended to provide general insights and foster a broader understanding of this important but complex topic. However, it should not be interpreted as legal advice. We recognize that legal matters can be complex and nuanced, and what may apply to one organization may not be applicable to another (or yours).
While we strive for accuracy, it's important to remember that this information may not reflect the latest legal developments or be relevant to your specific situation. Please seek guidance from your own trusted legal or compliance expert.
