Nonprofit Accounting Basics

Unclaimed Property

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Escheat Tax: More commonly called Unclaimed Property Tax, this can be a real trap for the unwary. Un-cashed vendor checks and un-cashed payroll checks are a couple of items that most people don’t think of as unclaimed property (most typically, we think of unclaimed bank deposits and securities). Nonprofits should familiarize themselves with the rules in their home states and take a close look at their own exposure for items on their books. If unclaimed property does exist, the organization should consider filing an escheat return and paying on these items. Many states are really looking at this as a revenue booster in hard times and are even hiring outside vendors to aggressively enforce their law and collect funds.