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California Proposes Unclaimed Property Voluntary Disclosure Program

Tax Development Feb 25, 2022

California Proposes Unclaimed Property Voluntary Disclosure Program

On February 16, 2022, the California Legislature introduced AB 2022, which would establish a Voluntary Disclosure Program for unclaimed property. If approved, this program would allow companies to become compliant without incurring a 12% interest assessment on the outstanding unclaimed property remittances. This would be the first such amnesty program for unclaimed property since the early 2000s. If enacted, this bill could encourage compliance from holders of unclaimed property that were reluctant to incur the high-interest assessment on the unreported amounts.

To be eligible for the program, holders of unclaimed property would have to comply with the following terms:

  • The holder could not be a subject of an examination or could not have received notice of an examination of unclaimed property,
  • The holder could not be the subject of a civil or criminal examination related to compliance with the state’s unclaimed property statutes,
  • The holder could not have had an interest assessment under unclaimed property statutes within the past five years that remains unpaid, and
  • The holder could not have had an interest assessment waived by the Controller in the past five years.

If accepted into the program, all interest would be waived, provided the eligible holder complied with the following terms:

  • The holder would be required to participate in a state-provided unclaimed property educational training program within three months of being accepted into the program,
  • The holder would be required to review their books and records for the previous 10 years preceding the date accepted into the program,
  • The holder would be required to provide a due diligence report 30 days before submitting the report required under the program,
  • Initial reports would be filed within six months of the date of acceptance, and
  • A final report would be due no sooner than seven months and no later than seven months and 15 days after the initial report, with full payment included.

If the above timelines are not followed, the Controller would have the right to reinstate all applicable interest assessments. The bill also contains language to protect the privacy of individuals in the interest of reducing identity theft and fraud by preventing the disclosure of certain documents provided during this program.

We will keep you updated as this legislation advances.


Mark A. Paolillo

Susan Han

Jeff Henshall

Christopher Jensen

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