On April 29, 2020 Vermont joined the growing group of states that has adopted RUUPA, when the governor signed HB 550, an act relating to unclaimed property (“Act”) into law. The Act is effective January 1, 2021.
The Act updates Vermont’s current unclaimed property law, and it is largely based on the revised model act produced by the Uniform Law Commission (ULC) in 2016. This act repeals Title 27, chapter 14 (Vermont’s current unclaimed property law) and replaces it with a new chapter 18.
The highlights of the new legislation include expanding record retention requirements, adjusting due diligence requirements, allowing use of extrapolation and statistical sampling for the failure to retain records and providing a transitional provision.
Retention of records:
The Act provides that “a holder required to file [an unclaimed property] report … shall retain records for ten years after the later of the date the report was filed or the last date a timely report was due to be filed, unless a shorter period is provided by rule of the Administrator”.
Due Diligence Requirements:
The Act adjusts and expands the due diligence requirements. The Act states “the holder…. shall send…. notice …. not more than 180 days nor less than 60 days before filing… “. In addition, the Act provides for electronic mail notice and states, “If an owner has consented to receive electronic-mail delivery from the holder, the holder shall send the notice…. both by first-class U.S. mail…. and by electronic mail, unless the holder believes that the…. electronic-mail address is invalid.”
Use of extrapolation and statistical sampling allowable if records are not retained:
The Act provides that “If a person subject to examination … does not retain the records required … , the administrator may determine the value of property due using a reasonable method of estimation based on all information available to the Administrator, including extrapolation and use of statistical sampling when appropriate and necessary… “.
Transitional provisions:
The Act states that “an initial report filed … for property that was not required to be reported before January 1, 2021, but that is required to be reported under this [Act], must include all items of property that would have been presumed abandoned during the 10-year period preceding January 1, 2021…”. Additionally, “a holder that did not comply with the law governing unclaimed property before January 1, 2021 is subject to applicable provisions for enforcement and penalties in effect before January 1, 2021”.
Conclusion
The unclaimed property environment is constantly changing. If you are uncertain about your unclaimed property responsibilities or whether your organization is complying with the latest statutes, engage with an unclaimed property professional such as MarketSphere. A professional advisor has the expertise and knowledge to help holders understand the requirements imposed by state statutes and regulations and recommend actions that need to be taken.
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