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The following is for informational purposes only

What Are Unclaimed Assets & How They Work?

How Do Assets Become Unclaimed?

Assets become unclaimed, forgotten, lost, or escheated when the contact with the rightful owner is lost over time due to:

  • Dormant accounts for an extended period.
  • Unreported changes of address.
  • Incomplete or damaged records.
  • Expired postal forwarding instructions.
  • A name change; usually caused by marital status (marriage or divorce).

After the dormancy period expires, unclaimed properties or money are usually handed over to the state where they are based, being legitimately protected and preserved to be returned to the owner instead of being reverted to the original source who distributed them.

How Do You Claim Unclaimed Assets in the U.S.?

To claim untaken property in the U.S., you have to file a claim and be ready to present documents that prove you are the lawful owner. The state authorities will start to investigate the claim and most probably will contact you, requesting more information or supporting evidence, depending on the case, such as:

  • Personal photo identification.
  • Social security number.
  • Stock certificate.
  • Prior tax return.
  • Gift return.
  • Current address or other contact information.
  • Death certificate or a statement of relationship or heir.

Typically, if the state accepts the demand, you'll have to sign an agreement stating that if somebody else successfully claims the assets you receive, you will repay the new petitioner the amount they're entitled to.

How Much Unclaimed Money is in the U.S.?

unclaimed assets

In 2020, federal agencies, states, and other national or governmental organizations collectively held around $49.5 billion in unclaimed cash and benefits, with $13 billion in New York alone. This means $150.82 for each American resident. According to the National Association of Unclaimed Property Administrators (NAUPA), the vast majority of these assets comes from:

  • Inactive accounts with less than $100.
  • Lost IRAs, 401(k)s.
  • Life insurance benefits.
  • Taxable investment accounts.
  • Uncashed traveler's checks.
  • Unclaimed monies (uncashed checks/warrants).

At the federal level, a key holder of unclaimed funds is the Internal Revenue Service (IRS), with $146.6 million in refund checks that have never reached their beneficiary. The average undeliverable refund check value is worth $1,471.Moreover, annually, approximately 25,000 payments and 15,000 savings bonds return as "undeliverable" to the Department of the Treasury. NAUPA estimates that only 5% to 20% might be reclaimed in the future.

Which States Have the Most Unclaimed Properties?

The top 10 states for the total amount of unclaimed, lost, or forgotten properties are:

  • New York ($13 billion).
  • California ($6.9 billion).
  • Texas ($3.5 billion).
  • Massachusetts ($2.4 billion).
  • Florida ($2.1 billion).
  • Pennsylvania ($1.8 billion).
  • Illinois ($1.8 billion).
  • Virginia ($1.5 billion).
  • Arizona and Washington ($1 billion each).
  • Maryland ($980 million).

Based on the unclaimed property per capita rate, the top 5 are:

  • New York ($664/person).
  • Massachusetts ($361/person).
  • Nevada ($290/person).
  • Rhode Island ($261/person).
  • Virginia ($183/person).

Where Does Unclaimed Property Come From?

Where Does Unclaimed Property Come From?

Unclaimed assets originate from multiple sources, such as:

  • Uncashed back wages, paychecks, and bonuses.
  • Gift certificates.
  • Unclaimed life insurance payouts or tax refunds.
  • Forgotten pension benefits.
  • Tangible assets from safe deposit box contents.
  • Unknown National Lottery prizes.
  • Abandoned stock holdings, bank accounts, deposits, and savings.

How Long Does the State Keep Unclaimed Property?

The state typically holds unclaimed assets for five years. This is also the "dormancy period" known as the amount of time that starts when a financial institution reports funds or accounts as unclaimed and ends when the government officially considers the property as "abandoned." The time limit might be different, depending on the type of asset and the state of jurisdiction. For example:

  • In California, it's three years after the date when the property or asset has become distributable or payable;
  • For unclaimed wages, it's three years in states like New York or Massachusetts, and one year in New Hampshire and Maine.

The current dormancy phases are:

  • Seven years in 1 U.S.jurisdiction.
  • Five years in 18 U.S.jurisdictions.
  • Three years in 33 U.S.jurisdictions.

In recent years, there's been a tendency to cut the safekeeping lengths and speed up the transfer of unclaimed property to the state treasurer.

How Do You Find Unclaimed Assets?

How Do You Find Unclaimed Assets?

As there is no official centralized information service, instant asset search will not show up with unclaimed money information, so you can search for unclaimed money by using the following governmental agencies and their specialized databases:

  • Credit Union Unclaimed Shares (
  • HUD/FHA Mortgage Insurance Refunds (
  • Treasury Hunt: Unclaimed U.S. Securities & Payments (
  • The National Association of Unclaimed Property Administrators ( with individual unclaimed asset websites by state.

For foreign claims, go to Treasury Managed Accounts - Unclaimed Moneys. You can also check if you're owed funds on websites like that feature collective records of all state-held unclaimed possessions. Before you do, verify if they're endorsed by the NAUPA.

What Does "Escheated to the State" Mean?

Escheatment is the process through which the state/government takes ownership of unclaimed estate assets or properties until the legal owner claims them. It usually happens when:

  • Someone dies without leaving any heirs or a will.
  • Financial institutions hand over bank accounts or assets that haven't been accessed for a long time, depending on the bank and state. For instance, three years for a savings account, one year for a current account, and could even go back as far as 15 years).

Do I Pay Taxes on Unclaimed Funds?

As long as assets are filed as "unclaimed," they're not taxable. You start paying taxes for any abandoned property when you reclaim it, and you get a state approval - that's when it's officially recognized as "taxable income." However, there are some unclaimed investments from an IRA or 401(k) that can be reclaimed tax-free.

What is a "Negative Report for Unclaimed Property"?

Fifty United States, Washington DC, Puerto Rico, and the U.S. Virgin Islands encourage unclaimed property holders to file an annual Negative Unclaimed Property Report to make sure they're up to date with their escheatment reporting and to maintain a record of voluntary compliance with the State Treasury Department. Although in most states it's not an official statutory requirement to submit it, the states where holders can file a report allow either of the following deadlines: October 31st, November 1st, or April 15th.

Which States Require Due Diligence Mailings for Unclaimed Property?

Which States Require Due Diligence Mailings for
								Unclaimed Property?

All states call for due diligence letters to be sent to apparent titleholders of abandoned property to avoid escheatment. Due diligence rules and standards change from one state law to another in terms of:

  • Amount thresholds.
  • Mailing deadlines: 30-120 days before the reporting date.
  • Particular language: state-specific footer, compulsory header warning (for example, California requests this exact paragraph: "THE STATE OF CALIFORNIA REQUIRES US TO NOTIFY YOU THAT YOUR UNCLAIMED PROPERTY MAY BE TRANSFERRED TO THE STATE IF YOU DO NOT CONTACT US".
  • Content requirements: the holder's contact information, deadline to take action, asset's value, change of address form, post-escheat declaration, owner verification requirements, a unique identifier (account number, claim number), and owner disposition preferences.

What is a "Holder of Unclaimed Property"?

The U.S. unclaimed property legislation defines the "holder" as any individual or business entity in possession of assets that belong to another party and fall under a state's unclaimed property regulations. Frequently, holders of unclaimed assets can be in the following categories: business associations, financial institutions, credit unions, insurance companies, securities firms, utility companies, sole proprietors, fiduciaries, brokerage firms, courts, medical facilities, government entities, and public officers.

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