Understanding state dormancy periods is one of the most important steps in complying with requirements. Unlike federal reporting obligations such as 1099 or W-2 filing, unclaimed property compliance is governed at the state level. That means each state has its own dormancy periods, reporting deadlines, and due diligence requirements. That means businesses with operations, customers, vendors, or employees in multiple states must track and follow each jurisdiction’s unique rules.
What is a dormancy period?
A dormancy period refers to the specific period of time during which property remains inactive or unclaimed by its rightful owner before it is considered abandoned property. Once this time has elapsed with no contact or activity from the owner, the property is deemed “unclaimed” and must be reported and remitted to the state according to its unclaimed property laws.
Common Property Types Subject to Dormancy
Common examples of unclaimed property include:
- Uncashed or outstanding checksÂ
- Customer credit balances or refundsÂ
- Security deposits from utilities or leasesÂ
- Safe deposit boxes or deposit box contentsÂ
- Securities, dividends, and mutual fund sharesÂ
- Payroll checks or commissionsÂ
- Vendor payments and accounts receivable creditsÂ
Unclaimed Property Dormancy Period by State
The table below provides a reference point for the most common dormancy periods by state, but always verify the most current statute or administrative guidance before filing. Dormancy rules can change, and some states publish updated requirements annually.
| Jurisdiction | General Dormancy (years) |
|---|---|
| Alabama | 3 |
| Alaska | 3 |
| Arizona | 3 |
| Arkansas | 3 |
| California | 3 |
| Colorado | 3 |
| Connecticut | 3 |
| Delaware | 5 |
| District of Columbia | 3 |
| Florida | 5 |
| Georgia | 5 |
| Guam | 3 |
| Hawaii | 5 |
| Idaho | 5 |
| Illinois | 3 |
| Indiana | 3 |
| Iowa | 3 |
| Kansas | 3 |
| Kentucky | 3 |
| Louisiana | 3 |
| Maine | 3 |
| Maryland | 3 |
| Massachusetts | 3 |
| Michigan | 3 |
| Minnesota | 3 |
| Mississippi | 5 |
| Missouri | 5 |
| Montana | 5 |
| Nebraska | 5 |
| Nevada | 3 |
| New Hampshire | 5 |
| New Jersey | 3 |
| New Mexico | 3 |
| New York | 3 |
| North Carolina | 5 |
| North Dakota | 3 |
| Ohio | 3 |
| Oklahoma | 5 |
| Oregon | 3 |
| Pennsylvania | 3 |
| Puerto Rico | 5 |
| Rhode Island | 3 |
| South Carolina | 5 |
| South Dakota | 3 |
| Tennessee | 3 |
| Texas | 3 |
| U.S. Virgin Islands | 3 |
| Utah | 3 |
| Vermont | 3 |
| Virginia | 5 |
| Washington | 3 |
| West Virginia | 3 |
| Wisconsin | 5 |
| Wyoming | 5 |
Why Dormancy Periods Matter
Each state establishes its own unclaimed property dormancy period by property type. In other words, the period of inactivity can differ depending on what kind of asset is being held.
Knowing these differences helps financial institutions, corporations, and other holders correctly determine when to start the due diligence process (the effort to contact the rightful owner) and when to report unclaimed property to the state. Missing these deadlines or misclassifying property types can lead to penalties, interest, or even audit exposure.
Unclaimed Property Reporting and Due Diligence Obligations
Before turning over unclaimed property to the state, holders are typically required to perform due diligence. This is a formal outreach process to notify the owner and give them a chance to claim their property. The due diligence deadline and the reporting deadline both depend on the state’s dormancy period and the property type involved.
For instance, a business might need to send due diligence letters 60–120 days before filing the annual unclaimed property report. After the dormancy period expires and due diligence has been completed, the holder must file the unclaimed property report and remit the property to the appropriate state agency.