Did you know that Arizona has Unclaimed Property laws? Failure to comply with the reporting requirements can result in penalties of 100% of the amount of assets held and additional penalties up to $5,000. In addition, if the state deems that you knowingly withheld the reports, it can prosecute for a fine of $1,000 plus one year in jail.
Arizona defines Unclaimed Property as a financial asset owed to an individual or business. While this can include many types of assets the most common item for small businesses is uncashed vendor, customer and payroll checks. With these common types of funds, property holders are required to turn the funds over to the state after a 3-year period of no contact with the property’s owner.
No amount is too small! The state does not provide a threshold for material amounts. All held property is required to be reported and turned over to the Arizona Unclaimed Property Unit.
Reports are due October 31st for the general business owner. However, if the asset has a value of at least $50, property holders are required to perform due diligence via a written notice sent to the last known address at least 120 days prior to reporting.
What happens if you find yourself holding property that you’ve never reported? Check out the Voluntary Compliance Program to avoid penalties and interest.
Contact BeachFleischman PC for assistance with your reporting requirements. You can also find more information on the state’s website.