Join now!   |   Subscribe   |   Pay an Invoice   |   Sign In
Unclaimed Property Focus
Blog Home All Blogs
UNCLAIMED PROPERTY FOCUS is a blog written by and for UPPO members, featuring diverse perspectives and insights from unclaimed property practitioners across the U.S. and Canada. We welcome your submissions to Unclaimed Property Focus. Please contact Tim Dressen via tim@uppo.org with any questions about submitting a blog post for consideration and refer to our editorial guidelines when writing your blog post. Disclaimer: Information and/or comments to this blog is not intended as a substitute for legal advice on compliance or reporting requirements.

 

Search all posts for:   

 

Top tags: unclaimed property  Compliance  education  UPPO  audits  Delaware  due diligence  litigation  Advocacy  reform  Members  ULC  UPPO annual conference  RUUPA  UP101  Gift Cards  legislation  reporting  UP Laws  Uniform Law Commission  fall reporting  Holders Seminar  UPPO Asks  VDAs  Canada  service providers  california  securities  uniform unclaimed property act  Annual Conference 

GDPR, Privacy Policies and You

Posted By Administration, Wednesday, August 29, 2018

During the past few months, you’ve likely seen numerous website popup messages asking you to review updated privacy policies and check a box confirming that you agree with the terms of use. 

 

Beginning on Sept. 19, uppo.org visitors will see a similar message. Upon visiting the website, you will be prompted to review and consent to UPPO’s updated privacy policy with a simple, one-time checkbox confirmation. Declining consent will result in the loss of some website functionality and online member profile suspension.

 

Implementing this consent requirement is necessary for compliance with the EU’s General Data Protection Regulation (GDPR). UPPO is committed to protecting member data and is taking this step to ensure compliance with applicable regulations.  

 

GDPR is a collection of rules aimed at modernizing and strengthening data protection practices across Europe. Despite a two-year window between its passage and implementation earlier this year, many organizations have begun feeling the effects of the new regulation in the past few months, as they attempt to fully understand their compliance responsibilities.

 

GDPR protects basic identity information and web data – location, IP address, cookies, etc. – along with a variety of other personal details, and aims to give consumers greater control over how this information is collected and used. In order to collect personal data, covered entities must obtain and document clean and explicit consent from data subjects. 

 

As such, companies have been updating their website privacy policies and terms to reflect what information they collect, with whom the data may be shared, and how it may be used. This is the reason you’ve been seeing so many website messages requiring you to agree to new privacy terms.

 

Although GDPR is aimed at protecting European citizens, companies based in the United States are not exempt from complying. If a company collects or processes personal data of EU residents, it is likely covered by the new rules. In order to help ensure GDPR compliance, many companies require all website visitors, regardless whether the individual or the company is located in the EU, to provide consent rather than attempting to identify and gain consent from only EU residents. 

 

This is merely a snapshot of the most visible and prominent aspect of GDPR. The overall regulation is detailed and complex. However, we hope it helps explain why UPPO and so many other organizations have been adding consent requirements to their websites. 

 

Tags:  data privacy  GDPR 

Share |
PermalinkComments (0)
 

Automating the Unclaimed Property Process for Greater Efficiency

Posted By Contribution from Michelle Graf, 2018/19 UPPO southern vice president, Thursday, August 23, 2018

All companies doing business in the United States today must comply with unclaimed property laws and regulations. Regardless of the size of your company, the process is clunky and hard to manage due to the differences within each jurisdiction’s laws governing the process. Automation can help remove the bumps and streamline the process, reducing your time and expense while assisting with your compliance.   

 

The first step to automation starts at the bank with something called Positive Pay. While most companies today use the Positive Pay process as a fraud protection tool, it also provides the framework to automate your unclaimed property process. This process requires you to send check information to the bank prior to distribution. Because the bank then holds a list of all valid checks issued, it can provide alerts when checks are presented for payment without a valid issue being on file. 

 

Once checks remain outstanding at the bank for six months, the bank can automatically remove them from the outstanding list and provide an electronic file containing this activity. A report listing the unpaid checks can also be downloaded from the bank if the volume does not justify an electronic solution. 

 

Next, ensure that the bank account is reconciled and either pull the property information from the enterprise resource planning (ERP) system or forward the file to the disbursing departments to they can perform research and provide necessary information. Once this is completed, add the activity into whatever system you use to track the property. 

 

As we all know, printing and mailing due diligence letters occurs throughout the year, depending on each state’s requirements. At times, thousands of letters need to be printed and mailed so, if the volume warrants it, invest in a letter folder/stuffer.  

 

Managing the incoming, returned due diligence letters is often the most tedious step in the unclaimed property life cycle. Most third-party software provides the ability to use bar scans and update large amounts of records at once, which is a great automation tool. You can also create a process to allow owners to return the due diligence letter by email, which makes it easier to automate the workflow so information quickly routes to the responsible department. Lastly, you can set up a process to allow owners to respond online. This takes a little more time and creativity (and security reviews along the way) but it is achievable and very efficient once implemented.

 

Automation is not only important but essential for any successful unclaimed property department. It helps ensure compliance, reduces costs and improves efficiency.

 

Tags:  automation 

Share |
PermalinkComments (1)
 

IRS Guidance Presents Challenges for Securities Holders

Posted By Contribution from Mike Ryan, 2018/19 UPPO eastern vice president, Thursday, August 16, 2018

On May 29, 2018, the Internal Revenue Service published Revenue Ruling 2018-17 – Withholding and Reporting with Respect to Payments from IRAs to State Unclaimed Property Funds. The ruling, which clarifies that property in an IRA that is escheated to the state meets the definition of a designated distribution under Section 3405 of the Internal Revenue Code (IRC) and therefore is subject to applicable tax withholding and reporting to the IRS.  

 

The ruling appears to be the result of guidance requested from the Information Reporting Program Advisory Committee (IRPAC), which provides an organized public forum for discussion of tax information reporting issues between IRS officials and representatives of the public.

 

According to the ruling, the payment of an individual’s interest in a traditional IRA to the state unclaimed property fund is a payment from an IRA that is treated as includible in gross income. The analysis in the ruling concludes that under Section 3405(e)(3), a nonperiodic distribution is a designated distribution that is not an annuity or similar periodic payment. Therefore, the payor shall withhold 10 percent of the distribution unless the IRA owner has previously established a different withholding rate or opted out of withholding.  

 

Because the escheatment of an IRA account is to be treated as includible in gross income and therefore subject to applicable withholding rules, it is also required that the distribution and withholding be reported on Form 1099, Distributions from Pensions, Annuities, Retirement or Profit-Sharing Plans, IRAs, Insurance Contracts, etc. 

 

Although the position presented in the revenue ruling implies that escheated IRAs have always been considered includible in gross income and subject to withholding and reporting, the ruling provides for an effective date of the earlier of Jan. 1, 2019, or the date it becomes reasonable practicable for the holder/trustee to comply with the requirements.  

 

The release of this Revenue Ruling has left many in the unclaimed property industry scratching their heads with concerns of how to execute a distribution for the IRA account, particularly those in the securities industry. This is because holders in the securities industry (broker dealers, equity stock, mutual funds, etc.) where IRAs are not held in a cash position are faced with concerns of liquidating a customer’s assets without their consent in order to fulfill the IRS reporting obligations. For these holders, compliance with the Revenue Ruling may not be possible without creating compliance issues with other federal regulations. 

 

Internal and/or external legal counsel should be consulted before liquidating securities to satisfy the IRS reporting requirement to determine what, if any, Securities and Exchange Commission (SEC) and/or Financial Industry Regulatory Authority (FINRA) violations may be present.  

 

Since most banks and financial organizations have already been withholding when reporting IRA assets in cash positions, this ruling will likely not have an impact on their process. If holders in the securities industry determine they will make the distribution from the IRA in order to fulfill the IRS withholding and reporting requirements, extensive system enhancements may be necessary. Systems will need to have capability to execute the distribution from the IRA, withhold the applicable tax, and report the distribution and withholding to the IRS and the owner by using IRS Form 1099-R.  

 

Holders will also be faced with decisions on how to report the distributions to owners when there is a bad address on the account. Generally, holders cease sending first class mailings to customers who have bad addresses.

 

The IRS has provided transition relief by providing a compliance date of “January 1, 2019, or the date it becomes reasonably practicable for the person to comply with those requirements,” however, it may take holders a more substantial amount of time to adequately update and test systems. 

 

In light of the new revenue ruling and pending tax implications to IRA customers, holders should consider enhancing owner location efforts as a means of reducing the number of IRAs escheated and subject to the ruling. 

Tags:  1099  IRA  IRS 

Share |
PermalinkComments (0)
 

UPPO Asks: What has been the most noteworthy change within the unclaimed property profession during your career?​

Posted By Administration, Thursday, August 9, 2018

Occasionally, UPPO asks members to respond to a question, sharing their ideas, insights, and experience. The recurring UPPO Asks feature is a compilation of their responses. 

 

We recently asked several members: What has been the most noteworthy change within the unclaimed property profession during your career? 

 

“In an effort to raise revenue and balance their budget, states have been actively initiating audits, shortened dormancy periods, and use third-party auditors with aggressive audit practices. However, the most noteworthy change during my career is the landmark Temple-Inland, Inc. v. Cookcourt case, which challenged the state of Delaware’s unclaimed property audit practices. Not only did the case shed light on Delaware’s estimation methodology, but it also challenged its constitutionality.  

 

“Everyone in the unclaimed property community remembers where they were, when they first read the U.S. District Court for the District of Delaware’s opinion holding Delaware’s executive action of auditing and assessing a multistate corporation’s unclaimed property, violated substantive due process because the states action when taken together, ‘shock the conscience.’ Those words reverberated throughout the unclaimed property community for several months. 

 

In finding that the audit assessment ‘shock the conscience’ the court relied on six factors including the fact that the state waited 22 years to conduct the audit and circumvented the typical three- to six-year statute of limitations period. As a result of the court’s decision, Delaware overhauled its unclaimed property statutes and among other things reduced the look back period and limit the statute of limitations. This is a landmark case, because the court decision significantly impacted the future of unclaimed property audits not only by Delaware, but other states as well.”—Zenith Lewis, manager, federal taxes, Southwest Airlines Co.

 

 

“In my 15-year career, there have been significant changes from online reporting, vast amount of resources such webinars, conferences, and – most importantly for me – I was tasked by my current employer to find an organization that would allow me to grow in my position and I came across UPPO. UPPO has been that noteworthy change. I have formed many friendships within this wonderful organization, joined committees, gained a multitude of knowledge and taken advantage of the certificate program.”—Rolita Brownlee, supervisor, policy management, Geico Marine Insurance

 

 

“The most noteworthy change in my opinion is the unclaimed property voluntary disclosure program (VDA), which gives holders an opportunity to come into compliance with their legal responsibilities. It’s also a great tool to use for mitigating the risk associated with premerger due-diligence and post-merger remediation. The benefits of the VDA program are a limited look-back period, and waived or reduced penalties and interest on past due items.  

 

“We recently used the VDA program to report past due property picked up from an acquisition. In this instance, the unclaimed property reports were filed in a timely manner, but there were other issues such as a lack of complete records that were at a greater risk of being noncompliance. Fortunately, working with a third-party vendor, we were able to reduce both the initial obligation and interest penalties. 

 

“Now, that I’ve had that experience, I’m excited about the latest changes in Delaware that revise the earlier guidelines and no longer permit the state to initiate audits without first giving a company the opportunity to enter into the VDA program. Hopefully, this change will benefit holders, especially since the potential for a state audit is higher after a M&A.”—Alicia Douglas, unclaimed property specialist, business development, Ocwen Financial Corporation

 

 

“The change to online filing and the requirements has been a huge change. It remains a constant struggle to be up to date on the all compliance changes.”—Susan Greulich, unclaimed property administrator, GFSS–Global Financial Services and Systems, Eaton

 

 

“The most noteworthy change in unclaimed property over the course of my experience would be the impact of audits. They have not only brought unclaimed property to the table for consumers/clients, but for companies overall. When I began in unclaimed property, there were so few policies, procedures and best practices in place, as well as hardly anyone who could share their experience or guidance in the process. Now we are seeing unclaimed property commercials on TV, online advertisements, and conversations among those not directly involved, and that is such a good thing. The newfound awareness will not only help to create more effective procedures, policies, best practices, etc. but will also lend itself to more individuals that know what unclaimed property is, as well as how it should be handled. I think the industry will continue to grow and expand and we are just beginning to break the surface. I look forward to staying tuned to what is in store in the future and beyond!”—Jessica Rogers, analyst, treasury consultant, Lincoln Financial Group

 

 

Now it’s your turn. What do you think are the most important personality traits for an unclaimed property professional? Add a comment to this post to share your response.

 

Tags:  unclaimed property  UPPO Asks 

Share |
PermalinkComments (1)
 

2018 Fall Reporting Guide Part 4 (South Carolina – Wyoming)

Posted By Administration, Tuesday, July 31, 2018

Fall reporting season is again fast approaching. Most U.S. states require holders to file reports by either Oct. 31 or Nov. 1. Following are reporting deadlines for these states, along with helpful links. This list is not exclusive to a specific holder industry, so please check the states’ websites for information on industry-specific reporting information and deadlines. Because of the amount of information included, this guide will be published in four parts:

 

Part 1 covers Alabama through Hawaii.

Part 2 covers Idaho through Minnesota.

Part 3 covers Mississippi through Rhode Island.

Part 4 covers South Carolina through Wyoming.

 

South Carolina

Report due: Nov. 1, 2018
Extensions: Extensions may be requested by email before the report due date.

 

Contact: unclaimed@sto.sc.gov or (803) 737-4771

South Carolina holder resources

 

Notes from UPPO’s state administrator survey:

  • South Carolina now requires negative reports be submitted via our website. Holders with only a few properties may also opt to create and submit a report on our website. 
  • ACH/Wire are the preferred method of payment. Checks will be accepted but must be accompanied by a Submission Confirmation form (available on our website).

 

South Dakota

Report due: Nov. 1, 2018
Extensions: Extensions may be requested in writing before the report due date.

 

Contact: holders@sdtreasurer.gov or (605) 773-3379

South Dakota holder resources

 

Notes from UPPO’s state administrator survey:

  • Instruction manual/handbook has been updated in the past three months.
  • Reporting portal has added the option to create your report online.
  • We cannot accept HDE files.

 

Utah

Report due: Nov. 1, 2018
Extensions: Extensions may be requested in writing before the report due date.

 

Contact: holders@utah.gov or (801) 715-3300, ext. 2

Utah holder resources

 

Notes from UPPO’s state administrator survey:

  • New URL: https://mycash.utah.gov/app/faq-report
  • Instruction manual/handbook has been updated in the past three months.
  • New manual online reporting. No HDE files allowed.
  • NO HDE files.
  • Worthless shares are no longer reportable.
  • DRPs must be sold and proceeds delivered to the state.
  • New landing site for reporting https://mycash.utah.gov/app/submit-a-report

 

Virgin Islands

Report due: Oct. 31, 2018
Extensions: No details provided.

 

Contact: (340) 774-7166

Virgin Islands holder resources

 

Virginia

Report due: Nov. 1, 2018
Extensions: Extensions may be requested.

 

Contact: William.Dadmun@trs.virginia.gov or (804) 225-2142 

Virginia holder resources

 

Notes from UPPO’s state administrator survey:

  • Instruction manual/handbook has been updated in the past three months.
  • Payment of any type is accepted and should be issued within two days of submitting your electronic file.
  • If a NAUPA file is submitted for the report data, and the remittance is submitted via ACH or wire transfer, then the AP-1 form can be submitted as a scanned document (after being signed and scanned) to Report.Remit@trs.virginia.gov. If you are reporting large numbers of tangible properties, and your software supports doing so electronically, you may now report tangible items in this manner. In the past we required paper reports for tangible reports. You should still set up the tangible reports as a separate report.

 

Washington

Report due: Oct. 31, 2018
Extensions: Extensions may be requested in writing before the report due date. Include company name, holder number, reason for extension request and amount of time requested.

 

Contact: ucp@dor.wa.gov or (360) 534-1502 or (800) 435-2429

Washington holder resources

 

West Virginia

Report due: Oct. 31, 2018
Extensions: Extensions may be requested.

 

Contact: UP-ReceiptsGroup@wvsto.gov or (800) 642-8687

West Virginia holder resources

 

Wisconsin

Report due: Nov. 1, 2018
Extensions: Extensions may be requested.

 

Contact: Email formor (608) 264-4594

Wisconsin holder resources

 

Notes from UPPO’s state administrator survey:

  • Instruction manual/handbook has been updated in the past three months.
  • Reports must be filed electronically. Reports on paper or CD will not be accepted.
  • In Wisconsin, holder reports can post automatically, making property available for claimants in as little as three days. Holder reports must be correct when submitted, as we may no longer have the property for you to file a claim for refund.
  • ACH payment methods preferred. See Wisconsin Holder Report Guide for details. WIRE payments are no longer accepted.
  • Unclaimed Property has been at the Wisconsin Department of Revenue for five years. However, holders continue to send paper reports to the Office of State Treasurer. Please note: DOR ONLY accepts e-filed holder reports, and our P.O. Box is 8982. The old P.O. Box associated with the Treasurer's Office has been closed.

 

Wyoming

Report due: Nov. 1, 2018
Extensions: Extensions may be requested in writing before the report due date.

 

Contact: upreports@wyo.gov or (307) 777-5590

Wyoming holder resources

 

For detailed information about reporting deadlines, dormancy periods, due diligence requirements, exemptions and deductions, electronic filing and much more, UPPO members can refer to the Jurisdiction Resource Guide

This post has not been tagged.

Share |
PermalinkComments (0)
 
Page 7 of 63
1  |  2  |  3  |  4  |  5  |  6  |  7  |  8  |  9  |  10  |  11  |  12  >   >>   >| 
Membership Software Powered by YourMembership  ::  Legal