A deadline is quickly approaching for unclaimed property, creating a limited window of time for businesses to take action. As of June 30, 2014, the Delaware Unclaimed Property Voluntary Disclosure Program (“Program”) will cease to accept new enrollees, and the state is likely to initiate enforcement efforts on those companies that chose not to participate in this initiative.
The Program was launched to offer a more business-friendly program, enabling companies to efficiently address their past property obligations while avoiding an audit. Operated by the Delaware Department of State, this Program offers amnesty for non-compliant companies at risk for an extensive, multiyear audit.
Any company incorporated in Delaware, or with operating entities/subsidiaries incorporated in Delaware, should strongly consider entering the Program. Optimal participants are companies that meet the criteria and have not been previously audited by the State of Delaware. Businesses that choose not to participate in this initiative are at high risk of audit. In fact, the State of Delaware has invited a number of companies to participate in this Program. Companies that received this request and opted not to join the Program are at substantially higher risk of being selected for audit.
This Program offers a number of advantages to Delaware-incorporated businesses, including:
- Eliminating the risk of a Delaware audit
- Reducing the financial impact and resource strain imposed by an audit
- Mitigating the liability associated with an extensive look-back period and potential penalties and interest assessments
- Avoiding an audit executed by a third-party audit firm with a financial incentive
The Program Administrator strongly recommends that businesses engage the counsel of a professional services firm with expertise in this business area.
TECHNICAL INFORMATION CONTACTS:
Mark A. Paolillo
Principal
Ryan
857.362.7522
mark.paolillo@ryan.com