No, we do not recommend treating the CDs as active unless the customer has communicated with the bank or made some other indication of interest in one of the CDs or the IRA.

We agree that the IRA should not be treated as abandoned under the Illinois Revised Uniform Unclaimed Property Act (Illinois RUUPA), which requires tax-deferred retirement accounts to be reported and remitted to the Treasurer on the later of:

1.         Three years after the date that a communication is returned undelivered (RPO) or, if re-sent within thirty days, the second RPO, or

2.       Three years after the apparent owner reaches the age of 70½ years, or one year after the date of mandatory distribution following the apparent owner’s death, whichever is earlier.

Based on these rules, we believe that your bank should not report tax-deferred retirement accounts until the later of the two trigger dates in paragraphs (1) and (2). If the customer has not died (to your bank’s knowledge) and is not yet 70½ years old, neither of the conditions in paragraph (2) have been met. Consequently, we do not recommend reporting this account as unclaimed property until one of the conditions in paragraph (2) has been met. 

However, the linked account provisions in the Illinois RUUPA would not treat the customer’s CDs as active simply because the IRA is not inactive. Without any indication of interest in either account from the customer, your bank must treat the CDs as inactive accounts.

There are several ways in which a customer could make an indication of interest in these accounts. For example, if a customer increases or decreases the CD balance (other than by a previously-authorized recurring ACH transaction), that would serve as a valid indication of interest in an IRA sharing the same mailing address as the CD. (For more information on various indications of interest, see our Q&A page on the Illinois RUUPA.)

For resources related to our guidance, please see:

• Illinois RUUPA, 765 ILCS 1026/15-210(f) (“If the apparent owner has another property with the holder to which Section 201(6) applies, then activity directed by an apparent owner in any other accounts, including loan accounts, at a financial organization holding an inactive account of the apparent owner shall be an indication of interest in all such accounts if:

(A) the apparent owner engages in one or more of the following activities:

(i) the apparent owner undertakes one or more of the actions described in subsection (b) of this Section regarding any account that appears on a consolidated statement with the inactive account;

(ii) the apparent owner increases or decreases the amount of funds in any other account the apparent owner has with the financial organization; or

(iii) the apparent owner engages in any other relationship with the financial organization, including payment of any amounts due on a loan; and

(B) the foregoing apply so long as the mailing address for the apparent owner in the financial organization’s books and records is the same for both the inactive account and the active account.”)