Remember those outstanding payroll checks the accounting department keeps asking you about? How about the unsuccessful direct deposit campaigns targeting the same employees repeatedly? Ever wonder what ended up happening with the outstanding checks that were never cashed? A common form of unclaimed property that is a cause for concern for employers is uncashed checks, otherwise known as unclaimed wages. That live pay check that you issued to one of your employees could be the same uncashed check that is aging on your company’s bank statement. According to Massachusetts law, unclaimed wages, including uncashed checks which have not been claimed for over a period of three years, are presumed abandoned and must be reported and remitted to the State Treasurer.
Before you begin the process of reporting and remitting unclaimed wages/property to the state of Massachusetts there are a few things that need to be done first.
- Identify the unclaimed wages to be remitted. All outstanding payroll checks for three years as of June 30 of the reporting year.
- Try to locate the owners of the property (uncashed check). A due diligence notice must be sent by first-class mail to the last known address of every owner (payee) with property valued at $100 or more at least 60 days prior to the filing of reports with the Unclaimed Property Division.
- Send the report package and funds to the State Treasurer’s Office. Notification letters for all property valued at $100 or more, must be sent at least 60 days prior to the escheatment of the property.
Now you know the process of reporting and remitting unclaimed property to the Commonwealth, but do you know there are potential fines and penalties associated with noncompliance? Make sure you are aware of all outstanding checks by state and that you are familiar with the various reporting requirements. Some states require a report to be filed to indicate whether you have reportable items for that year. If no items are reportable a negative report is required.
Every state has different aging requirements as to when unclaimed wages are presumed abandoned. Please refer to your state web page for further information.
If you have any questions or would like to learn more about this topic, please reach out to Genesis HR Solutions at AskUs@genesishrsolutions.com or 800-367-8367.
Genesis HR Solutions is the premier PEO provider for Massachusetts based businesses.
