Topic: Unclaimed Property
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Under the new Illinois unclaimed property law, we understand that automatically renewing certificates of deposit (CDs) may become unclaimed property. Are we required to send letters and obtain written consents “at or about the time of the renewal” for these accounts? Such a process would be costly for our bank.
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No, the new Illinois Revised Uniform Unclaimed Property Act (Illinois RUUPA) does not require a bank to send letters or obtain written consents from CD owners. The Illinois RUUPA does provide that automatically renewable accounts will not be considered unclaimed if “the apparent owner consented in a record on file with the holder to renewal…
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Under the new Illinois Revised Unclaimed Property Act (Illinois RUUPA), am I correct that the start date for the presumed abandonment period for UTMA accounts is different than regular deposit accounts?
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Yes, the Illinois RUUPA establishes different presumed abandonment periods for deposit accounts and Uniform Transfers to Minors Act (UTMA) accounts. For both deposit accounts generally and UTMA accounts, the presumed abandonment period is three years, but those periods begin to run on different dates. For deposit accounts, the start date for the presumed abandonment period…
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Under the new Illinois Revised Unclaimed Property Act (Illinois RUUPA), in order not to consider an account abandoned because the owner has other accounts with the bank, must all the accounts be titled in the same way?
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No, the Illinois RUUPA does not require bank accounts to be titled in the same way. As under previous Illinois law, certain activities on one bank account can be treated as activity on all other accounts held by the same owner at the same bank. There are certain conditions that apply — for example, the…
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Under the new Illinois Revised Unclaimed Property Act (Illinois RUUPA), if an account owner of an automatically renewable certificate of deposit (CD) has other accounts at the bank, do we need to establish customer contact at the time of renewal? Is there a onetime consent form that can be signed at the time of account opening so the bank does not have to establish customer contact at the time of each renewal?
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No, the Illinois RUUPA does not require a bank to establish customer contact at the time of renewal. To prevent an automatically renewing CD from becoming unclaimed, the owner also can indicate an interest in the account, which prevents the presumed abandonment period from running. As your question suggests, valid indications of interest include activities…
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Under the new Illinois Revised Uniform Unclaimed Property Act (Illinois RUUPA), are Roth IRAs treated as IRAs? The law refers to “tax-deferred retirement accounts,” and my understanding is that Roth IRAs are not considered tax-deferred because they are funded with after-tax dollars.
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We believe that the Illinois RUUPA provisions governing tax-deferred retirement accounts should apply to Roth IRAs, based on informal verbal guidance from the Illinois Treasurer’s office. We posed this question to an attorney with the Illinois Treasurer’s office, who told us that the Illinois RUUPA provisions applicable to accounts qualifying “for tax deferral under the…
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Under the new Illinois Revised Unclaimed Property Act (Illinois RUUPA), what is the definition of “indication of interest”?
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The Illinois RUUPA identifies at least nine different activities that would be considered an “indication of interest” that would prevent property from being considered unclaimed. Valid indications of interest include increasing or decreasing account funds, written communications, oral communications for which your bank “contemporaneously makes and preserves a record of the fact of the apparent…
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My department is responsible for reporting safe-deposit box contents to the Illinois Treasurer. Is there anything new in the new Illinois Revised Uniform Unclaimed Property Act for reporting property in safe-deposit boxes?
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The new Illinois Revised Uniform Unclaimed Property Act (Illinois RUUPA) adds reporting obligations regarding safe-deposit box property and modifies the process of obtaining reimbursements of safe-deposit box opening expenses and unpaid rent. The Illinois RUUPA’s reporting obligations include new details on the “location of the property” held in a safe-deposit box, as well as “where…
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Under the new unclaimed property law, if a customer is transferring interest accruing on a certificate of deposit (CD) to another account at our bank, will that be considered an indication of interest? If we pay interest on the CD in the form of a check and the customer cashes that check, is that an indication of interest? If the CD owner has other active accounts with our bank with the same mailing address, is that an indication of interest? In other words, is it correct to say that the only CDs we should be monitoring are those where the owner has no other accounts with us and which have compounding interest?
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The answer to your first three questions is yes — all of those activities constitute indications of interest in a CD that would prevent the presumed abandonment period from running. The Illinois Revised Uniform Unclaimed Property Act (Illinois RUUPA) would treat the transfer of accrued interest from a CD account as an indication of interest…
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Under the new Illinois unclaimed property law going into effect on January 1, 2018, when is a health savings account (HSA) presumed abandoned if the presumed owner is deceased?
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Under the Illinois Revised Uniform Unclaimed Property Act (Illinois RUUPA), HSAs generally are presumed abandoned thirty-three years after the date the account was opened, unless there is a distribution or the owner dies. HSAs are governed by a provision in the Illinois RUUPA that covers a wide range of tax-deferred accounts, including HSAs. Any one…
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In the new Illinois unclaimed property law, there is a requirement to include the name and last-known address of the beneficiary for “a life or endowment insurance policy, annuity contract, or other property where ownership vests in a beneficiary upon the death of the owner.” Would this requirement apply to payable on death (POD) and IRA beneficiaries?
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Yes, the reporting of beneficiary information applies to POD and IRA beneficiaries, as for other types of property for which “ownership vests in a beneficiary upon the death of the owner.” We contacted an attorney at the Illinois Treasurer’s office, who confirmed that this provision applies to POD and IRA beneficiaries. The State Treasurer’s intent…