Unclaimed property may not be the first thing that you think about when you thing about missing money, but it’s more common than you might think. It is estimated that 1 in 7 Americans has unclaimed money, totaling $70 billion. Whether it’s an inheritance, a utility deposit, or an old insurance policy, many people are unaware of the assets waiting to be reclaimed in their name.
Checking for missing money is an important part of our stewardship responsibility. In this blog post, we’ll explore what unclaimed property is, how to find it, and why it’s important to take action and claim what’s rightfully yours.
It only takes a few minutes to check, and you might find money you didn’t know you had!
What Is Unclaimed Money
Unclaimed money (or assets) occurs when a business, financial institution or government cannot locate the rightful owner (or if the owner fails to claim them). This can be because someone moved, died, provided incorrect contact information, had a misspelled name or address etc.
The unclaimed funds can be broken into two main categories:
A. When a business or financial institution holding the money or assets cannot locate the rightful owner, the cash/asset are turned over to the state.
Each state sets a dormancy period, or inactivity period. In Pennsylvania, that period is 3 years. After that point, the asset is sent to the PA Unclaimed Property Fund where the ownership details and the amount are maintained in a searchable database.
B. If the Federal government cannot find a recipient of money, the individual agency normally holds the money. Each agency has a separate database with the ownership information and amount.
Unclaimed funds can be from a variety of sources. Here are some examples:
- inactive bank accounts
- insurance payouts
- utility refunds
- government benefits
- uncashed checks
- inheritance – when a rightful heir cannot be located
- safe deposit box contents
- stocks
Generally, if the unclaimed property is not in cash, it will eventually be sold and converted into cash. The databases listing unclaimed property are free, publicly available, and provides the instructions about how to claim the cash.
Why Are There Laws About This?
The unclaimed property laws started in the 1950’s as state governments became concerned about forgotten accounts. Over the years they have evolved, requiring companies to turn over dormant accounts to a state’s unclaimed property fund.
Most states do not provide interest on the funds, and use the interest earned on the unclaimed funds to meet funding shortfalls. For example, Pennsylvania has about $3.5 billion in their unclaimed property fund, which helps meet the state’s budgetary needs.
The inactivity period used to be longer, but there has been a trend to decrease it. This is forcing more money to be sent to the state’s unclaimed property fund. States claim that having a shorter time before dormancy, makes it easier to find the necessary paperwork. However, others say that it can be difficult to successfully file a claim, due to the documentation hurdles the state requires. In response, some states are making it easier to file a successful claim.
In 2023 over $5 billion was returned by the states, with the average claim being $1,154. Though the system may be cumbersome, it does work.
Where to Search for Missing Money
Unfortunately, there is not one website where you can search all sources for missing money. Below are a number of websites that cover the major areas. However, this is not an exhaustive list:
State Unclaimed Property
MissingMoney.com has links to each state’s unclaimed property website. It also allows you to search across the entire US (with the exception of Hawaii) to see if you have missing money in other states you lived in. Then you can follow the prompts and file a claim.
This is one of the best resources available, and one that everyone should search. Remember, your unclaimed funds are not usually earning interest, so submitting a claim a soon as possible is ideal.
Federal Unclaimed Property
1. Payments from Employers/Retirement Plans
A. The Department of Labor has a database to see if an employer owes you back pay
B. The Pension Benefit Guaranty Corporation (PBGC) helps you find an unclaimed pension
C. The Retirement Savings Lost & Found Database enables you to search for old retirement plan accounts
D. Using the National Registry of Unclaimed Retirement Benefits website is another resource to find old retirement plan accounts
2. Savings Bonds
Treasury Hunt allows you to search for missing U.S. Treasury savings bonds and securities
3. Unclaimed Insurance
Veteran Affairs (VA) lets you search for unclaimed life insurance funds
FHA Insurance Refund if you had a mortgage issued by the Federal Housing Administration (FHA), you may be eligible for a refund of your mortgage insurance
4. Investments
Securities & Exchange Commission (SEC) database for money from an investment enforcement case
5. Bank Failures
Search the FDIC database for unclaimed funds from closed banks
Find unclaimed deposits from closed credit unions
6. Tax Refunds
The IRS has a tool to check on the status of your tax refund
7. Bankruptcies
US Courts Unclaimed Funds Locator helps you search for money that may be owed to you after a person or business declared bankruptcy
8. Individual Indian Money Accounts (IIM)
The Department of the Interior has a searchable database for Native American and Alaska native beneficiaries
Frequently Asked Questions
How can I claim my money?
Each of the websites above have a different claim process. Most of them are online, though some will require paper identifying documents. The process is not difficult, but it can take some time.
The amount of time it can take to process a claim will vary. However, it will usually take at least a few months from start to finish.
I haven’t moved in 30 years, should I still check?
Yes, absolutely. Financial institutions are supposed to make multiple attempts to contact the rightful owner before the property is sent to an unclaimed property fund. However, it is not unusual for someone who has never moved to have unclaimed property. It is important for everyone to check periodically.
Is the claims process difficult?
It is not necessarily difficult, but it can be time consuming. The earlier you find unclaimed money, the easier it is to provide the necessary documentation. The most complicated cases are estates that were settled years ago, as it may be challenging to find the required paperwork.
Why do they request such specific documentation?
They want to make sure the rightful owner gets their missing money back. If they didn’t request this information, anyone would be able to claim they own it.
Do I need to pay someone for this?
Access to finding missing money and completing the claims process is entirely free. There is no need to hire someone.
How do I avoid scams?
If you receive an email, phone call, text message etc notifying you of lost property and requesting a fee upfront to help you, don’t fall for it. The websites listed above are the legitimate sources of information that are publicly available. If you follow their instructions, you can avoid being scammed.
Do I pay tax on unclaimed property?
You may, it will depend on the circumstances. Contact your tax professional to determine if you would owe taxes.
Final Thought
Checking the above websites for missing money should be done every couple of years. It is a fairly easy thing to do, and will save you a lot of time in the long run. I would encourage you to share this information with friends and family, as unclaimed property is becoming more of an issue in the digital age.
