The Essentials of Minnesota’s Unclaimed Property Act for Businesses and Consumers
The Minnesota Unclaimed Property Act is a consumer protection law intended to allow the owner of financial assets to retrieve property even after an extended period. The State obligates every business to assist in this retrieval process by reporting any unclaimed property held.
What is Unclaimed Property?
Unclaimed property refers to financial assets held by a business for which there has been no activity or contact from the property owner for a defined period of time, known as the dormancy period. Depending on the type of financial asset, this period can be one, three, or five years. Common examples of unclaimed property include checking and savings accounts, uncashed checks, customer overpayments, and the contents of a safe deposit box.
How Businesses Identify Unclaimed Property
Businesses should have policies and procedures in place to identify when they are holding unclaimed property, such as uncashed checks, dormant customer deposits, and credit memos.
Efforts to Locate Property Owners
A business holding unclaimed property must make every effort to reestablish contact with the property owner if an address for the presumed owner is available and the property value is $100 or more. If the effort is unsuccessful, the property will be presumed abandoned and must be turned over to the State no later than 120 days after failure to locate the owner.
Reporting Unclaimed Property to the State
Businesses must report unclaimed property to the Minnesota Unclaimed Property Program annually by November 1st. The report must include property details and documentation identifying the property owner. Reports are submitted through the Minnesota Department of Commerce website.
Consequences for Failing to Report Unclaimed Property
Failure to file a report for several consecutive years may prompt a notice from the Minnesota Commerce Department requiring the business to complete a self-audit. A self-audit involves reviewing internal records for unclaimed property to avoid an on-site audit and related penalties. A business that willfully refuses to pay or deliver unclaimed property to the State can result in a gross misdemeanor for the business owner. Additional penalties and 12% interest based on the value of the unclaimed property may also be imposed.
How Property Owners Can Claim Unclaimed Assets
A report to the State must include the property and documentation about the property owner, who can then file a claim for that property by searching the Minnesota Department of Commerce website. In Minnesota, consumers and businesses can claim unclaimed property by searching the database of the Missing Money and Unclaimed Property website. Individuals and businesses nationwide can search through www.missingmoney.com. By filing a claim, they can recover the financial assets to which they are entitled. Reach out to your Copeland Buhl advisor if you need assistance or have questions about Minnesota’s Unclaimed Property Act.