FILING YOUR ANNUAL UNCLAIMED PROPERTY REPORT
The State of Michigan released a new system for reporting unclaimed property in October 2018. This new system allows business owners to file reports and remit unclaimed payments electronically. While this applies to several different type of property, it is especially common in the healthcare industry for those practices who have many outstanding refund checks issued to patients. According to the Manual for Reporting Unclaimed Property, unclaimed property is defined as “tangible or intangible property that is unclaimed by its rightful owner.” This would include any uncashed checks in the form of vendor payments, payroll and commission checks, refunds or overpayments and insurance claim checks. The dormancy period for all of these is three years, with the exception of wage and commission checks that have a dormancy period of one year. Once the property reaches the end of the dormancy period the practice would be required to review and take the appropriate course of action.
After the dormancy period is reached, business owners must investigate each piece of property. Outstanding checks should be reviewed for accuracy to determine if it is still owed to the individual. If it is, the individual or business should be contacted to inform them of the payment. Once contacted, checks can be voided and reissued if necessary being that most often the owner had misplaced the check. However, property with a value of $25 or less (or $50 or less for wages) does not need to be reported and can be handled internally by voiding the check. This threshold would exclude any dividend checks. In any situation, how property is handled should be documented in the event of a possible future audit by the Michigan Department of Treasury.
Once all unclaimed property is investigated, any remaining items where the owner was unreachable must be turned over to the State of Michigan by filing an unclaimed property report. These reports must be filed by the first business day in July annually for any unclaimed property that has reached the dormancy period as of March 31st in the filing year. This process has been made significantly easier through the electronic platform.
Reports can be filed by either uploading a NAUPA file or completing a manual report. Either option will require some basic information about the practice in addition to listing the owner’s name, property type, check number and check amount. Although not required, Michigan businesses are encouraged to file zero dollar reports if there is no unclaimed property to report.
If you have nay questions, please contact firstname.lastname@example.org.