By: Shirley Boatright, MBA- Senior Assistant Accountant
All business operating in Ohio or holding funds due to Ohio resident are required to file Annual Report of Unclaimed Funds. Businesses other than Life Insurance companies have a November 1st reporting deadline. Life Insurance companies have a May 1 deadline.
*IRC 501(C) (3) hospitals and political subdivisions are exempt from filing.
What are Unclaimed Funds?
All intangible property unclaimed by its owner(s) for a specific period of time, such as, unclaimed wages, dividends, credit balances, dormant savings and checking accounts, and many other types of outstanding checks. A comprehensive list of accounts that are reportable as unclaimed funds and Nature of Funds Code can be found in the Annual Report of Unclaimed Funds Forms, Instructions and Information booklet located on the Ohio Department of Commerce website.
Accounts exempt from reporting:
- Unclaimed Wages less than $50.00
- Business to Business exemption, and;
- Gift Certificate redeemable for Merchandise
Unclaimed Funds Filing Steps
- Identify Dormant Accounts: A detailed review of the business records to identify dormant accounts as of the preceding June 30 of the filing due date, November 1.
- Research the Accounts: Identified dormant accounts should be thoroughly reviewed to determine accurate unclaimed funds amount(s). Documentation of research and any work papers should be retained in the annual reporting file for five (5) years or until an examination is conducted.
- Due-Diligence Mailing Requirement: Businesses are required to send a notice to the last known address of owner or beneficiary of dormant accounts with a balance of $50.00 or more.
- No mailing is required for dormant accounts less than $50.00, however, applicable accounts would be reported in the Aggregate total.
- Reporting Unclaimed Accounts: Business are required to report all relevant accounts with the owner’s information, specific account details, and nature of the funds code. A Negative Report is required for any business not holding any unclaimed funds. Report is due by November 1st.
- Businesses can request for an extension on the UCF which is also due by November 1st. Businesses have a choice of 30,60-,90- or 120-day extension.
For more information on dormant accounts, due-diligence mailings and reporting requirements please see the Annual Report of Unclaimed Funds Forms, Instructions and Information booklet located on the Ohio Department of Commerce website.
Companies failing to file can face significant penalties. Business failing to report or underreporting unclaimed funds can incur civil penalties of $100.00 per day and pay 1% interest per month on the balance of unclaimed funds.
If your business has not filed unclaimed funds or has questions relating to please reach out to Holbrook & Manter to advise you.