The bipartisan SAFER Act would establish a federal death-based standard for escheatment of investment and retirement assets, potentially preempting state unclaimed property laws and reshaping compliance obligations for financial institutions.
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While we typically do not post developments on pending legislation, Representatives Sam Liccardo (D-CA) and Mike Lawler (R-NY) have introduced the Safeguarding Americans’ Fairly Earned Retirement (SAFER) Act, a bipartisan bill that would significantly limit when financial institutions can transfer investment and retirement assets to states under state unclaimed property laws. If enacted, the SAFER Act would represent the federal government’s first direct intervention in state unclaimed property laws in decades.
State unclaimed property laws require financial institutions to remit “dormant” assets—such as forgotten bank accounts, stocks, or uncashed checks—to state governments after a specified dormancy period. Since the 1960s, every state has established a formal program to take custody of these forgotten assets until the rightful owner can be found. Although these programs are intended as consumer protection measures to help owners recover lost funds, states often liquidate these assets and use the proceeds to supplement their budgets in the interim.
The legislation seeks to establish a uniform federal standard and would preempt conflicting state laws, replacing commonly used inactivity-based dormancy triggers with a confirmation-of-death framework.
Prohibit escheatment without confirmation of death, requiring a minimum of three years after death before assets may be transferred.
Delay escheatment of joint accounts until all owners are confirmed deceased.
Prevent escheatment where an estate has expressed interest.
Require periodic death searches beginning after five years of inactivity for retirement-age account holders and every five years thereafter.
Apply broadly to securities, investment accounts (including retirement accounts), and digital assets.
Preempt state escheatment laws that conflict with the SAFER Act.
The bill directly challenges current state audit positions that rely on inactivity, returned mail, or other indicators to trigger escheatment assets—often without confirmation of death. It reflects growing industry concern regarding the treatment of long-term or passive investment accounts and the operational burden of inconsistent state requirements.
In a related development, Senator Elizabeth Warren, in her role as Ranking Member of the U.S. Senate Committee on Banking, Housing, and Urban Affairs, sent a letter to the National Association of Unclaimed Property Administrators on April 15, 2026. The letter requested information about the use of return mail and inactivity-based dormancy triggers in each state. Taken together, these actions signal a clear intent by Congress to move toward a federally mandated death-notification standard for the escheatment of retirement accounts and related financial assets.
No immediate compliance changes—current state laws remain in effect.
This has heightened relevance in audits, particularly for investment and retirement accounts.
There is potential for standardization if this federal legislation is signed into law.
Financial service industry holders should closely monitor these developments to assess operational impact and consider avenues for advocacy.
The SAFER Act represents a significant potential shift in the unclaimed property landscape. By imposing a death-based standard and preempting state laws, the bill would materially limit escheatment based solely on inactivity. Even if not enacted, it signals an evolving unclaimed property policy landscape and effective industry advocacy that may influence audit activity and compliance expectations.
Our team of experts is ready to help inform your team and guide you through the potential impacts of this pending legislation.
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.
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