The state governments earn interest on nearly 42 billion (as of May 2015) in unclaimed money! “Unclaimed money” belongs to someone else — not the government - which holds it for safe-keeping. Somehow it has been forgotten, unknowingly abandoned, or lost in the mail. To get back what is rightfully yours, you need to know what it is and how to find it.
Whatever the reasons, about one in every ten people has unclaimed money waiting for them. Some of it could be yours! Even celebrities, who have hired experts to manage their money, end up finding unclaimed money in their name, so don't be embarrassed if there's an account you've forgotten about somewhere!
In 2011 over 2.5 million claims were made and $2.5 billion was returned to its true owners. It’s worth learning more about getting free unclaimed money.
Sounds kind of like winning the lottery, doesn’t it? In fact, the average claim in 2011 was $892, but individual claims can range anywhere from less than ten to hundreds and thousands of dollars — even millions.
Celebrities, politicians and well-known business people have unclaimed money and don’t know about it. If you understand what it is and how to find it, you can claim it without paying anyone to help you do it.
Discover your program today!
What Is Unclaimed Money?
First — if you are tempted to buy a book about the topic of free money or unclaimed money, be sure to read our review of Kevin Trudeau's book on Free Money. We reveal the good, the bad and the ugly!
Unclaimed money takes many forms. And there's more than $42 billion of it being held by the states. For example, in California (with more than $6 billion in unclaimed property), you would find some cash and equities as well as gold bars, diamonds (half a million dollars worth…) and coins in gold and silver…not to mention numerous bottles of alcohol! (Learn more about this in our May 2016 Free Money Newsletter.)
Other states also hold hundreds of millions of dollars in unclaimed money. And they have been criticized for not doing enough to find the rightful owners. Some states, like Delaware, are particularly aggressive about going after companies to be sure they are turning over all unclaimed property. Delaware earlier in 2016 lost a battle in court and was chastised by being unreasonably aggressive in going after a business and assessing steep fees even though their own reporting procedures were unclear. Maybe that has something to do with the fact that Delaware collected $527 million in the 2015-2016 fiscal year – and that makes it the third highest source of funds in the state budget.
If you belonged to a credit union that failed there is a separate search resource you can use to see if you can recover lost funds. The NCUA website can help you as long as your credit union was federally insured. You can search by your name or by the location and it’s best to do it within a year and a half of the credit union’s failure. But of course you can always try even if more than that time period has passed. Veterans can also find a search option on the VA website that helps vets and their families look for insurance money that has gone unclaimed.
Some other examples may help you understand how it unclaimed property comes about, and why. It will also help to convince you that it's worth taking a shot at finding some in your name. If you take the pretty brief time needed to learn and don't get fooled by those who offer to help for a fee you can do some simple but comprehensive searches yourself.
News December 2016 Here’s an interesting item, and one that should encourage you to do all you can to find unclaimed property in your name. In some states, like Wisconsin, they make efforts to find rightful owners by placing newspaper advertisements and by trying to match state records. But if after three years the contents of safety deposit boxes have not been claimed, the laws of the state require that the unclaimed property be put in a public auction! Don’t believe it? The Wisconsin Department of Revenue is holding an online auction through December 27, 2016. You can visit their website to see what’s up for sale. And be sure to start doing your own free searches for your own unclaimed property before your state puts it up for sale — and keeps the revenue!
Types of Unclaimed Money
- Money is classified as unclaimed when an account is inactive for a number of years (the number varies from state to state) or when a mailed check is returned and no new address can be found.
- In the case of a bank, unclaimed money may be in savings or checking accounts or in safe deposit boxes.
- A corporation may be considered to be holding unclaimed money if a payroll check has gone uncashed for a specific period of time, and attempts to contact the ex-employee via mail or e-mail are unsuccessful.
- A mutual fund or securities brokerage may have unclaimed money in inactive accounts as described in the case of banks. Or they may have mailed dividend checks, for example, that have been returned as undeliverable with no forwarding address.
- An insurance company may have been unable to contact the beneficiaries of insurance policies when a person has died and no one has shown up to claim them.
- The IRS is holding millions of dollars in refunds that have been returned as unable to be delivered. Some of it may be yours if you moved without notifying the IRS as they will use the last known address they have on file for you.
- Many people also have unclaimed money which the IRS is holding because they did not file taxes when they were not legally required to. For example, if you had a job but your earnings were low enough that you were not required to file a return, you probably had taxes that were withheld from each paycheck. This money would have gone to the government and, without filing a return, you never triggered those funds to be returned to you. In addition, you may have earned too little to require that you file taxes, but enough so that you would have been entitled to the earned income tax credit.
- For the year 2011 alone the IRS had $1 billion in unclaimed tax refunds — but April 2015 was the last date that the money could be claimed. We don’t know what happens to those funds but unfortunately it probably doesn’t get distributed to taxpayers! If you don’t bother filing a return because you don’t expect to owe anything because of your low income, you could be missing out on as much as $5000 or more in the Earned Income Tax Credit. It’s too late now for 2011 but if you have some income it could be a very good idea to file late returns for 2012 - 2014.
Important Things to Know About Unclaimed Money
Stocks What if you’re lucky enough find that a state is holding something like inherited stock you didn’t know about in your name? Once you fill out all the paperwork and get your stock you will probably want to cash in by selling it. But what happens at tax time? You will need to report the transaction when you file, and the information required will include the acquisition date, the initial cost, the sale date and your proceeds from the sale. What should you use for the “acquisition cost”? According to tax advisors, your cost basis is the price of the stock on the date of the death of the person who left it to you multiplied times the number of shares of stock you received. You can find stock prices on previous dates on financial sites like Schwab or Yahoo Finance and others.
- If money is being held by an entity other than the federal government, like a bank or insurance company or even a utility company or other corporation, after a certain period of years that money must be turned over to the states.
- When money is turned over to the state, it will go to the state of your last known address, even if you lived there only a short time. It is therefore worth doing a search in every state in which you have lived, no matter how briefly.
- You may be entitled to unclaimed money in someone else's name if you can prove you are an heir of that person, so your searches should not be made only in your name.
Finding Unclaimed Money
- You may contact government agencies like the IRS directly to see if they are holding money in your name.
- Most unclaimed money is held by individual states and in many cases you must contact them directly.
- Though states are required by law to try to find the rightful owners of the unclaimed property they are holding, they do have conflicting priorities. They hold a LOT of unclaimed money and earn a lot of money on it. For example, the state of Delaware is being sued by a company for its aggressive methods of finding and taking ownership of unclaimed property. In 2015 alone the state acquired $500 million in unclaimed property. That represents nearly 14% of its total collected revenue. And the state has used the money for projects like maintaining roads and making improvements to its parks and some public buildings. Pretty easy for a state to become quite used to having this money available and not spend much in the way of resources on finding people to send it back to. So it's super important that you take the initiative and do your own searching!
- There are some centralized databases you can search and tips and tricks you need to know to make sure you cover all possibilities. Discover how to look and where to look – without paying anyone – in our article Find Unclaimed Money. We also provide some advice on how to set up a simple system to track your searches and remind yourself to repeat them periodically. Billions of dollars are turned over the the government each year so it is worth repeating your searches at least annually.
Happy Hunting and good luck!