The Treasury Department’s Bureau of Audits periodically audits dealers to determine compliance with the Pennsylvania Disposition of Abandoned and Unclaimed Property Act. This Act requires dealers that have abandoned or unclaimed property to report and remit such property to the Department if, after the holding period, the property remains unclaimed. The deadline to file an unclaimed property report with the Pennsylvania Treasury Department is April 15 each year. This law applies to any property that does not legally belong to the holder.
2-year Holding Period
Gift certificates with specified redemption (after expiration of redemption period)
Uncashed payroll checks, wages and commissions
Court ordered utility refunds
Property distributable in connection with the demutualization of an insurance company
Property distributable in the course of dissolution of a business association, financial institution, or utility (from the date of final distribution)
3-year Holding Period
Bank accounts
Refunds/Rebates
Contents of safe deposit boxes
Tangible property
Uncashed accounts payable checks
Uncashed operating fund checks
Credit balances
Stocks and bonds
Proceeds from insurance policies or annuities
Escrow accounts
Vendor payments
7-year Holding Period
Money orders
15-year Holding Period
Travelers Checks
Those who are audited for unclaimed property may be subject to a penalty not to exceed $1,000 per day, beginning with the day after the report should have been filed and continuing each day thereafter until a proper report is filed.
Dealership Issued Gift Certificates
The Pennsylvania Disposition of Abandoned and Unclaimed Property Act has been amended to provide incentives for dealerships to issue qualified gift certificates and gift cards that do not contain an expiration date and are not subject to post-sale fees or charges.
If a dealership issues qualified gift cards and qualified gift certificates, they are exempt from reporting requirements. A qualified gift card or certificate cannot contain an expiration date or any type of post-sale charge or fee. A dealership that issues a qualified gift card or certificate will not have an obligation to remit unredeemed amounts to the Treasury Department. However, dealerships will be obligated to redeem the gift card or certificate indefinitely. If a dealership were to issue a non-qualified gift card or certificate, the law requires the dealership to report and remit such property to the Treasury Department 2 years after the expiration of the redemption period.
The number of years that the dealership is required to retain the property, before it is remitted to the Treasury Department, depends on the type of property being held. More information is available at www.patreasury.org.
Courtesy of PAA Bulletin No. 5, 3/12/2018
