Nonprofits have a menu of options when it comes to fundraising. These range from the tried-and-true methods of direct mail and email marketing, to up-and-coming approaches like live-streamed events. But sometimes funds are there, yours, and simply waiting to be claimed, no donor solicitation required.
What Is Unclaimed Property?
Unclaimed property, also known as abandoned property, typically involves intangible personal property that belongs to an individual or organization, but which is turned over by financial institutions and other organizations to states’ unclaimed property offices after a specified period of time during which there has been no activity with respect to the property. States then, generally, hold this property until its owner or heirs claim it. Among the more common types of unclaimed property are refunds, rebates, utility deposits, credit balances from prior bank accounts, stocks, and even uncashed checks. Nonprofit membership organizations and nonprofits that sell products, such as educational materials, may even be entitled to funds from members or clients that never reached the organization.1
All fifty states and the District of Columbia have laws governing unclaimed property.2 Many of these jurisdictions have modeled their legislation after the Uniform Disposition of Unclaimed Property Act and the Uniform Unclaimed Property Acts, which can be broadly classified as consumer protection laws meant to safeguard owners’ interests in their property. In short, the laws are designed to facilitate how the public—including nonprofit organizations—can claim what’s rightfully theirs.
How Can Your Organization Search for and Claim Abandoned Property?
Unclaimed property records can be searched on a state-by-state basis by visiting the website of each state’s comptroller or other office charged with administering the unclaimed property program. The website www.unclaimed.org, run by the National Association of Unclaimed Property Administrators (NAUPA), provides links to each state’s unclaimed property website. But conveniently, nonprofits can run a multi-state search on the NAUPA-endorsed website, www.MissingMoney.com.
If searching for your organization’s name yields unclaimed property results, then a representative should initiate a claim. The procedures for claiming property vary, depending on the state in which the property is held, but often involve submitting a notarized letter on organizational letterhead or completing a state-provided form to make the request. The specific process necessary to claim property in each state is generally explained and readily available on the state’s unclaimed property website.
Although the administrative effort involved in searching for and preparing the necessary paperwork to make a claim to abandoned property may be tedious, your organization may be surprised to learn about the return this “fundraising” method delivers. In our experience, some nonprofits, particularly membership organizations, have been able to recover several thousand dollars, and occasionally much more, by following up on unclaimed property search results, which may make it well worth taking a look at these state records.
- Conversely, note that your nonprofit may also hold unclaimed property of others from time to time, such as uncashed payroll accounts, member dues refunds, or funds owing from customer returns. If these items cannot be provided to the owner because of address change, death, or other reason, the property must be provided, or "escheated," to the state. Each state has its own rules for reporting, and states perform compliance audits periodically. Please contact us if you need assistance with unclaimed property compliance with respect to property held by your nonprofit that belongs to others.
- Several U.S. territories and some foreign jurisdictions also have such laws.