Month: April 2024

Unclaimed property involves intangible property, normally cash, checks or securities. The only
tangible property involved would be safe deposit box contents that goes unclaimed if the
holder/bank may have lost contact with the owner. This would constitute unclaimed property
when the state dormancy/holding period has been met.
Once the dormancy period has been met, normally 3 or 5 years, the state laws require the
property to be reported and remitted to the appropriate state in a timely manner. The state
where the property should be reported was decided by the 1965 Supreme Court case, Texas vs
New Jersey which was:
~ (Priority Rule # 1) Unclaimed intangible property is reported to the state of the
owner’s/payee’s last known address as reflected on the holder’s/entity’s books and records;
~ (Priority Rule #2) However, if the address is unknown (or where mail cannot be
delivered) or a foreign address, the unclaimed property defaults to the holder’s state of
incorporation/domicile.
The above-mentioned Priority Rules were tested by two additional court cases and upheld in
Pennsylvania vs New York and Delaware vs New York. Once the statutory dormancy period
has been met, the holder is obligated to report/remit the property to the appropriate state as
prescribed in the Priority Rulings. It is worth noting that unclaimed property reporting is NOT a
tax, therefore Nexus does not apply.
Please note that every state has adopted unclaimed property laws, some more robust than
others, but all have similar requirements and are governed by the Priority Rules. For further
information on your unclaimed property reporting obligations or to discuss the laws, feel free to
reach out to the professionals at PEACC by calling 410.303.5510 or email us at
info@peacc.com.