Based on the Illinois Treasurer’s recently published proposed administrative rules, your bank may wait until the next reporting date (November 1) following a CD’s maturity before remitting the funds to the state.

Under the Illinois Revised Uniform Unclaimed Property Act (Illinois RUUPA), automatically renewing CDs that are reportable as unclaimed property do not have to be remitted to the Illinois Treasurer if doing so would result in a penalty or forfeiture of interest. The law itself states that these CDs must be remitted at the time when such penalty or forfeiture “no longer would result from payment.” This language appears to require the CDs to be remitted to the Illinois Treasurer as soon as they mature.

However, the Illinois Treasurer has proposed administrative rules clarifying that such CDs do not need to be remitted until the holder’s next report is due — in the case of a bank, on November 1. We note that these rules are unlikely to be finalized until the spring of 2019.

For resources related to our guidance, please see:

• Illinois RUUPA, 765 ILCS 1026/15-603(b) (“If property in a report under Section 15-401 is an automatically renewable deposit and a penalty or forfeiture in the payment of interest would result from paying the deposit to the administrator at the time of the report, the date for payment of the property to the administrator is extended until a penalty or forfeiture no longer would result from payment, if the holder informs the administrator of the extended date.”)

• Illinois Treasurer, Proposed Administrative Rules, 42 Ill. Reg. 17145, 17167 (September 28, 2018) (Section 760.215(b)(5): “When a holder is required to remit a presumptively abandoned automatically renewable deposit with a penalty or forfeiture of interest provision depends upon the term of the deposit.

A) A presumptively abandoned automatically renewable deposit with a term of less than one year should be remitted to the administrator in the holder’s first report after the initial term plus 3 years.

EXAMPLE: A 6-month certificate of deposit would be remitted with the holder’s first report after 4 years have passed. This would be the initial 6-month term plus the 6 additional 6-month terms that comprise the 3-year period of abandonment and then the time, which should be less than a year, until the holder’s next report is due under the Act.

B) A presumptively abandoned automatically renewable deposit with a term of less than 3 years, but more than one year, should be remitted to the administrator with the holder’s first report after the initial term plus 3 years plus any time needed to avoid a penalty.

EXAMPLE: A 2-year certificate of deposit would be remitted with the holder’s first report after 6 years have passed. This would be the initial 2-year term plus the 3-year period of abandonment plus the final year of the third 2-year term so as to avoid the penalty (i.e., the first report after three 2-year terms).

C) A presumptively abandoned automatically renewable deposit with a term of 3 years or more should be remitted to the administrator with the holder’s first report after the end of the second term of the deposit.

EXAMPLE: A 5-year certificate of deposit would be remitted with the holder’s first report after 10 years have passed. After the first 5- year term, the end of the 3-year period of abandonment falls within the second 5-year term. So, to avoid any penalty, the certificate of deposit is remitted with the holder’s first report after the end of the second 5-year term.”)