Did your company receive a letter from the Delaware Secretary of State (SOS) regarding its Unclaimed Property Voluntary Disclosure Program? On February 20, 2020, the SOS mailed more than 100 new invitations to the program, which allows companies to get into compliance with Delaware’s unclaimed property law without the threat of penalties and interest.
Normally, a targeted company has just 60 days to respond to the invitation to join the program. The SOS previously extended the response deadline until May 22, 2020 because of COVID-19 and the various stay-at-home orders in effect across the country. Recently, on June 18, 2020, Delaware’s Office of Unclaimed Property (OUP) sent letters to companies that failed to respond to the February 2020 invitations, advising holders that the OUP will refrain from issuing audit notices for an additional 30 days, giving holders a response deadline of July 18, 2020. This is due to Delaware’s recognition that many holders have not had full access to their mail or the proper time to send the invitation to the appropriate individual.
If your company does not respond by the deadline, it will be referred to the Delaware State Escheator for audit. To avoid an audit, companies should send a completed VDA-1 to enroll in the SOS Voluntary Disclosure Agreement (VDA) Program as soon as possible during this additional 30-day period.
Please note that Delaware-originated audits typically expand to additional states, as Delaware unclaimed property audits are conducted by third-party audit firms with multistate contracts.
The SOS has typically addressed these certified mail invitations to the company’s CEO or CFO, so please check with these individuals and/or the company’s mailroom if you are uncertain as to whether your company has been contacted.
If you are considering signing up for the VDA program, Ryan can help. We have a full-service team of unclaimed property professionals who can assist in analyzing your company’s records and identifying potential exposure. We can also assist in negotiating and settling the VDA in Delaware and/or any other states.
TECHNICAL INFORMATION CONTACTS:
Mark A. Paolillo
Principal
Ryan
857.288.1976
mark.paolillo@ryan.com
Jeff Henshall
Principal
Ryan
404.682.1200
jeff.henshall@ryan.com
Susan Han
Principal
Ryan
442.244.2447
susan.han@ryan.com
Christopher Jensen
Principal
Ryan
469.399.4142
christopher.jensen@ryan.com
The material presented in this communication is intended to provide general information only and should solely be seen as broad guidance and not directed to the particular facts or circumstances of any individual who may read this publication. No liability is accepted for acts or omissions taken in reliance upon the content of this piece. Before taking (or not taking) any action, readers should seek professional advice specific to their situation from Ryan, LLC or other tax professionals. For additional information about this topic, please contact us at info@ryan.com.