TAKE ACTION NOW TO AVOID A MUCH MORE BURDENSOME & MANDATED REQUIREMENT LATER - FILE YOUR ANNUAL UNCLAIMED PROPERTY REPORT.

DEALERSHIP AUDITS FOR UNCLAIMED PROPERTY ON THE RISE

IADA recently met with the State Treasurer’s Office to discuss an uptick in unclaimed property audits of dealerships.  Several of our Dealer Members have received a self-audit notice from the Illinois Treasurer’s Office regarding compliance with unclaimed property filing requirements. The unclaimed property statute requires an annual report to be filed with the Treasurer’s Office by May 1 of each year. The Treasurer’s Office is requiring dealers to become compliant with the unclaimed property statutes and requirements as soon as possible. After meeting with IADA, the Treasurer’s Office has agreed to permit dealers to request a deadline extension as described below. 

Per statute, property held is considered “unclaimed” three years after it has remained in possession of the “holder”, or dealer. A report is to be filed annually for property that has been deemed to be “unclaimed” per statute. For example, the 2022 filing will include all property that became unclaimed in 2018.

The Treasurer’s Office indicated that they were most interested in unclaimed property that consisted of items such as: uncashed payroll checks, unreturned deposits or refunds due customers, uncashed accounts payable checks to vendors, etc. 

If you receive a self-audit notice from the Treasurer’s Office, the Office will ask for unclaimed property back to 2009. The request to retrieve records back to 2009 is burdensome and often not possible. IADA attended a meeting with those that handle unclaimed property within the Treasurer’s Office in late March. We indicated to them that requesting records back to 2009 would be too burdensome on the dealers both time wise and economically. The Treasurer’s Office understood and was most interested in dealer compliance with the statute and continued compliance going forward.

Dealers who have not filed unclaimed property reports in past years will not be able to meet the May 1 reporting deadline, but those dealers can request an extension through the Treasurer’s Voluntary Disclosure Agreement Program (VDA).

The Treasurer’s Office also indicated that they are happy to assist with getting your dealership into compliance. They have sent us some information to help with becoming compliant. IADA assured those in the Treasurer’s Office that we would pass the information along and encourage our members to become compliant, preferably before receiving a self-audit request. Additional information about unclaimed property reporting is provided below. 

If you have any questions, please reach out to Alina Archibald at the Treasurer’s Office at aarchibald@illinoistreasurer.gov or 217-524-0649. 

Unclaimed Property Resources

• Revised Uniform Unclaimed Property Act - https://www.ilga.gov/legislation/ilcs/ilcs3.asp?ActID=3794&ChapterID=62
• Admin Code - https://ilga.gov/commission/jcar/admincode/074/07400760sections.html (a great resource when have questions after reviewing RUUPA – it has detailed information of Illinois Unclaimed Property laws and might answer most of the questions)
• Reporting Instructions - https://icash.illinoistreasurer.gov/docs/IL_Reporting_Instructions.pdf
• Treasurer’s Unclaimed Property Website - https://icash.illinoistreasurer.gov/

The Unclaimed Property reporting deadline for car dealerships is May 1st and covers the period of the prior calendar year. For example, the properties that meet its abandonment period during year 2022 will be reported on or before May 1, 2023. 

A due diligence letter is required to be sent for properties over $50. Due diligence requirements and the content for the letter can be found in the Admin Code.  An Unclaimed Property report can be submitted 60 days after due diligence letters were sent or later. 

If a dealer has a reasonable cause for filing late, an extension can be requested in writing and sent to UP_Report@IllinoisTreasurer.gov. For more information about extensions, please review the Treasurer’s Admin Code. Please note, due diligence processes and other actions required by the Act do not constitute reasonable cause.

Retention of records requirements for Holders can also be found in detail in the Treasurer’s Admin Rules. 

The Illinois State Treasurer’s Office encourages non-reporting Holders to come to compliance with Unclaimed Property laws through its Voluntary Disclosure Agreement Program (VDA). Under a VDA program, the administrator will agree to waive, in whole or in part, interest and penalties for a person who voluntarily reports and remits to the administrator property that should have been previously reported, paid or delivered to the administrator pursuant to the Act. The application to the Treasurer’s VDA program can be found on at: https://ilga.gov/commission/jcar/admincode/074/074007600F08400R.html and emailed to aarchibald@illinois.gov for review. The Holder will have 6 months to complete the VDA program.