2002 Legislation
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HOUSE BILL NO. 439 – Unclaimed property, holding period

HOUSE BILL NO. 439

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Daily Data Tracking History



H0439aaS............................................by REVENUE AND TAXATION
UNCLAIMED PROPERTY - Amends existing law on unclaimed property to change
the holding period from seven years to five years for traveler's checks,
money orders, checks, drafts and similar instruments issued or certified by
banking and financial organizations, property held by agents and
fiduciaries, and contents of safe deposit boxes or other safekeeping
repository; and to delete the special reporting period for insurance
companies.
                                                                        
01/16    House intro - 1st rdg - to printing
01/17    Rpt prt - to Rev/Tax
01/22    Rpt out - rec d/p - to 2nd rdg
01/23    2nd rdg - to 3rd rdg
01/28    Rls susp - PASSED - 70-0-0
      AYES -- Aikele, Barraclough, Barrett, Bedke, Bell, Bieter, Black,
      Block, Boe, Bolz, Bradford, Bruneel, Callister, Campbell, Clark,
      Collins, Crow, Cuddy, Deal, Denney, Ellis, Ellsworth, Eskridge,
      Field(13), Field(20), Gagner, Gould, Hadley, Hammond, Harwood,
      Henbest, Higgins, Hornbeck, Jaquet, Jones, Kellogg, Kendell, Kunz,
      Lake, Langford, Loertscher, Mader, Martinez, McKague, Meyer,
      Montgomery, Mortensen, Moyle, Pearce, Pischner, Pomeroy, Raybould,
      Ridinger, Roberts, Robison, Sali, Schaefer, Sellman, Shepherd,
      Smith(33), Smith(23), Smylie, Stevenson, Stone, Tilman, Trail,
      Wheeler, Wood, Young, Mr. Speaker
      NAYS -- None
      Absent and excused -- None
    Floor Sponsor - Wood
    Title apvd - to Senate
01/29    Senate intro - 1st rdg - to Loc Gov
02/07    Rpt out - to 14th Ord
02/08    Rpt out amen - to 1st rdg as amen
02/11    1st rdg - to 2nd rdg as amen
02/12    2nd rdg - to 3rd rdg as amen
02/13    3rd rdg as amen - PASSED - 28-6-1
      AYES -- Andreason, Branch(Bartlett), Brandt, Bunderson, Burtenshaw,
      Deide, Dunklin, Frasure, Goedde, Hill, Ingram, Ipsen, Keough,
      King-Barrutia, Little, Lodge, Marley, Noh, Richardson, Risch, Sandy,
      Sims, Sorensen, Stegner, Stennett, Thorne, Wheeler, Williams
      NAYS -- Boatright, Darrington, Davis, Geddes, Hawkins, Schroeder
      Absent and excused -- Cameron
    Floor Sponsor - Bunderson
    Title apvd - to House
02/14    House did NOT concur in Senate amens - 60-5-5
    To Chief Clerk

Bill Text


                                                                        
                                                                        
  ||||              LEGISLATURE OF THE STATE OF IDAHO             ||||
 Fifty-sixth Legislature                  Second Regular Session - 2002
                                                                        
                                                                        
                              IN THE HOUSE OF REPRESENTATIVES
                                                                        
                                     HOUSE BILL NO. 439
                                                                        
                             BY REVENUE AND TAXATION COMMITTEE
                                                                        
  1                                        AN ACT
  2    RELATING TO UNCLAIMED PROPERTY LAW; AMENDING SECTION 14-504,  IDAHO  CODE,  TO
  3        CHANGE  THE  HOLDING  PERIOD FROM SEVEN YEARS TO FIVE YEARS FOR TRAVELER'S
  4        CHECKS AND MONEY ORDERS AND TO MAKE TECHNICAL CORRECTIONS;  AMENDING  SEC-
  5        TION  14-505, IDAHO CODE, TO CHANGE THE HOLDING PERIOD FROM SEVEN YEARS TO
  6        FIVE YEARS FOR CHECKS, DRAFTS AND SIMILAR INSTRUMENTS ISSUED OR  CERTIFIED
  7        BY  BANKING  AND  FINANCIAL  ORGANIZATIONS; AMENDING SECTION 14-506, IDAHO
  8        CODE, TO CHANGE THE HOLDING PERIOD FROM SEVEN YEARS TO FIVE YEARS FOR BANK
  9        DEPOSITS AND FUNDS IN FINANCIAL ORGANIZATIONS AND TO MAKE  TECHNICAL  COR-
 10        RECTIONS;  AMENDING  SECTION  14-512,  IDAHO  CODE,  TO CHANGE THE HOLDING
 11        PERIOD FROM SEVEN YEARS TO FIVE YEARS FOR  PROPERTY  HELD  BY  AGENTS  AND
 12        FIDUCIARIES;  AMENDING  SECTION 14-516, IDAHO CODE, TO CHANGE  THE HOLDING
 13        PERIOD FROM SEVEN YEARS TO FIVE YEARS FOR CONTENTS OF A SAFE  DEPOSIT  BOX
 14        OR  OTHER  SAFEKEEPING REPOSITORY; AMENDING SECTION 14-517, IDAHO CODE, TO
 15        DELETE THE SPECIAL REPORTING PERIOD FOR INSURANCE COMPANIES AND TO MAKE  A
 16        TECHNICAL CORRECTION; AND PROVIDING AN EFFECTIVE DATE.
                                                                        
 17    Be It Enacted by the Legislature of the State of Idaho:
                                                                        
 18        SECTION  1.  That  Section  14-504, Idaho Code, be, and the same is hereby
 19    amended to read as follows:
                                                                        
 20        14-504.  TRAVELER'S CHECKS AND MONEY ORDERS. (1) Subject to subsection (4)
 21    of this section, any sum payable on a traveler's check that has been outstand-
 22    ing for more than fifteen (15) years after its issuance is presumed  abandoned
 23    unless  the owner, within fifteen (15) years, has communicated in writing with
 24    the issuer concerning it or otherwise indicated an interest as evidenced by  a
 25    memorandum or other record on file prepared by an employee of the issuer.
 26        (2)  Subject to subsection (4) of this section, any sum payable on a money
 27    order or similar written instrument, other than a third-party bank check, that
 28    has been outstanding for more than seven five (75) years after its issuance is
 29    presumed  abandoned unless the owner, within seven five (75) years, has commu-
 30    nicated in writing with the issuer concerning it  or  otherwise  indicated  an
 31    interest  as  evidenced by a memorandum or other record on file prepared by an
 32    employee of the issuer.
 33        (3)  A holder may not deduct from the amount  of  a  traveler's  check  or
 34    money order any charge imposed by reason of the failure to present the instru-
 35    ment  for  payment  unless  there  is a valid and enforceable written contract
 36    between the issuer and the owner of  the  instrument  pursuant  to  which  the
 37    issuer  may  impose a charge and the issuer regularly imposes such charges and
 38    does not regularly reverse or otherwise cancel them.
 39        (4)  No sum payable on a traveler's check, money order, or similar written
 40    instrument, other than a third-party bank check, described in subsections  (1)
 41    and  (2)  of  this  section  may  be subjected to the custody of this state as
 42    unclaimed property unless:
 43        (a)  The records of the issuer  show  that  the  traveler's  check,  money
                                                                        
                                           2
                                                                        
  1        order, or similar written instrument was purchased in this state;
  2        (b)  The  issuer has its principal place of business in this state and the
  3        records of the issuer do not show the state in which the traveler's check,
  4        money order, or similar written instrument was purchased; or
  5        (c)  The issuer has its principal place of business  in  this  state,  the
  6        records  of the issuer show the state in which the traveler's check, money
  7        order, or similar written instrument was purchased and  the  laws  of  the
  8        state  of  purchase  do not provide for the escheat or custodial taking of
  9        the property or its escheat or unclaimed property law is not applicable to
 10        the property.
                                                                        
 11        SECTION 2.  That Section 14-505, Idaho Code, be, and the  same  is  hereby
 12    amended to read as follows:
                                                                        
 13        14-505.  CHECKS,  DRAFTS  AND  SIMILAR  INSTRUMENTS ISSUED OR CERTIFIED BY
 14    BANKING AND FINANCIAL ORGANIZATIONS. (1) Any sum payable on a check, draft, or
 15    similar instrument, except those subject to section  14-504,  Idaho  Code,  on
 16    which  a  banking  or  financial  organization is directly liable, including a
 17    cashier's check and a certified check, which has  been  outstanding  for  more
 18    than  seven five (75) years after it was payable or after its issuance if pay-
 19    able on demand, is presumed abandoned, unless the  owner,  within  seven  five
 20    (75)  years, has communicated in writing with the banking or financial organi-
 21    zation concerning it or otherwise indicated an interest as evidenced by a mem-
 22    orandum or other record on file prepared by an employee thereof.
 23        (2)  A holder may not deduct from the amount of any instrument subject  to
 24    this  section  any  charge  imposed  by  reason  of the failure to present the
 25    instrument for payment unless there is a valid and  enforceable  written  con-
 26    tract between the holder and the owner of the instrument pursuant to which the
 27    holder  may impose a charge, and the holder regularly imposes such charges and
 28    does not regularly reverse or otherwise cancel them.
                                                                        
 29        SECTION 3.  That Section 14-506, Idaho Code, be, and the  same  is  hereby
 30    amended to read as follows:
                                                                        
 31        14-506.  BANK  DEPOSITS  AND  FUNDS  IN  FINANCIAL  ORGANIZATIONS. (1) Any
 32    demand, savings, or matured time deposit with a banking or financial organiza-
 33    tion, including a deposit that is automatically renewable, and any funds  paid
 34    toward  the purchase of a share, a mutual investment certificate, or any other
 35    interest in a banking or financial organization is presumed  abandoned  unless
 36    the owner, within seven five (75) years, has:
 37        (a)  In  the  case of a deposit, increased or decreased its amount or pre-
 38        sented the passbook or other similar evidence of the deposit for the cred-
 39        iting of interest;
 40        (b)  Communicated in writing with the banking  or  financial  organization
 41        concerning the property;
 42        (c)  Otherwise established that the owner is currently aware of his inter-
 43        est  in  the property as evidenced by a memorandum or other record on file
 44        prepared by an employee of the banking or financial organization  describ-
 45        ing  the  activity  of  the owner which establishes that the owner is cur-
 46        rently aware of his interest in the property  stating  the  date  of  such
 47        activity and the address of the owner as of that date;
 48        (d)  Owned other property to which paragraph (a), (b), or (c) of this sub-
 49        section  applies and if the banking or financial organization communicates
 50        in writing with the owner with regard to the property that would otherwise
 51        be presumed abandoned under this subsection at the address to which commu-
                                                                        
                                           3
                                                                        
  1        nications regarding the other property regularly are sent; or
  2        (e)  Had another relationship with the banking or  financial  organization
  3        concerning which the owner has:
  4             1.  Communicated  in  writing with the banking or financial organiza-
  5             tion; or
  6             2.  Otherwise established that the owner is currently  aware  of  his
  7             interest  as  evidenced  by a memorandum or other record on file pre-
  8             pared by  an  employee  of  the  banking  or  financial  organization
  9             describing the activity of the owner which establishes that the owner
 10             is currently aware of his interest, stating the date of such activity
 11             and the address of the owner as of that date.
 12        (2)  For  purposes  of  subsection  (1) of this section, property includes
 13    interest and dividends.
 14        (3)  A holder may not impose with respect to property described in subsec-
 15    tion (1) of this section any charge due to dormancy  or  inactivity  or  cease
 16    payment of interest unless:
 17        (a)  There  is  an enforceable written contract between the holder and the
 18        owner of the property pursuant to which the holder may impose a charge  or
 19        cease payment of interest;
 20        (b)  For  property  in  excess of two dollars ($2.00), the holder, no more
 21        than three (3) months before the initial imposition of  those  charges  or
 22        cessation of interest, has given written notice to the owner of the amount
 23        of those charges at the last known address of the owner stating that those
 24        charges  will  be imposed or that interest will cease, but the notice pro-
 25        vided in this section need not be given with respect to charges imposed or
 26        interest ceased before the effective date of this chapter; and
 27        (c)  The holder regularly imposes such charges or ceases payment of inter-
 28        est and does not regularly reverse or otherwise cancel  them  or  retroac-
 29        tively credit interest with respect to the property.
 30        (4)  Any  property  described  in  subsection  (1) of this section that is
 31    automatically renewable is matured for purposes of subsection (1) of this sec-
 32    tion upon the expiration of its initial time period, but in the  case  of  any
 33    renewal  to which the owner consents at or about the time of renewal by commu-
 34    nicating in writing with the banking or financial organization,  the  property
 35    is  matured  upon the expiration of the last time period for which consent was
 36    given. If, at the time provided for delivery in section 14-519, Idaho Code,  a
 37    penalty  or forfeiture in the payment of interest would result from the deliv-
 38    ery of the property, the time for delivery is extended until the time when  no
 39    penalty or forfeiture would result.
                                                                        
 40        SECTION  4.  That  Section  14-512, Idaho Code, be, and the same is hereby
 41    amended to read as follows:
                                                                        
 42        14-512.  PROPERTY HELD BY AGENTS AND FIDUCIARIES. (1) Intangible  property
 43    and any income or increment derived therefrom held in a fiduciary capacity for
 44    the  benefit  of another person is presumed abandoned unless the owner, within
 45    seven five (75) years after  it  has  become  payable  or  distributable,  has
 46    increased or decreased the principal, accepted payment of principal or income,
 47    or communicated concerning the property.
 48        (2)  Amounts  due  and  payable  from property in an individual retirement
 49    account, defined benefit plan, or other account or plan that is qualified  for
 50    tax deferral under the income tax laws of the United States, is presumed aban-
 51    doned  three (3) years after the earlier of the date of the required distribu-
 52    tion as stated in the documents governing the account or plan, or the date, if
 53    determinable by the holder, specified in the income  tax  law  of  the  United
                                                                        
                                           4
                                                                        
  1    States  by  which  distribution of the property must begin in order to avoid a
  2    tax penalty, but excluding property in any such account or plan if  the  docu-
  3    ments  governing the account or plan provide a method for the treatment of the
  4    account balance of an account holder or plan participant  or  beneficiary  who
  5    cannot be located.
  6        (3)  For  the  purposes of this section, a person who holds property as an
  7    agent for a business association is deemed to hold the property in a fiduciary
  8    capacity for that business association alone, unless the agreement between him
  9    and the business association provides otherwise.
 10        (4)  For the purposes of this chapter, a person  who  is  deemed  to  hold
 11    property  in  a  fiduciary  capacity  for  a business association alone is the
 12    holder of the property only insofar as the interest of the  business  associa-
 13    tion  in the property is concerned, and the business association is the holder
 14    of the property insofar as the interest of any other person in the property is
 15    concerned.
                                                                        
 16        SECTION 5.  That Section 14-516, Idaho Code, be, and the  same  is  hereby
 17    amended to read as follows:
                                                                        
 18        14-516.  CONTENTS OF SAFE DEPOSIT BOX OR OTHER SAFEKEEPING REPOSITORY. All
 19    tangible and intangible property held in a safe deposit box or any other safe-
 20    keeping  repository in this state in the ordinary course of the holder's busi-
 21    ness and proceeds resulting from the sale of the property permitted  by  other
 22    law,  which  remain unclaimed by the owner for more than seven five (75) years
 23    after the lease or rental period on the box or other repository  has  expired,
 24    are presumed abandoned.
                                                                        
 25        SECTION  6.  That  Section  14-517, Idaho Code, be, and the same is hereby
 26    amended to read as follows:
                                                                        
 27        14-517.  REPORT OF ABANDONED PROPERTY. (1) A person holding property  tan-
 28    gible  or  intangible,  presumed abandoned and subject to custody as unclaimed
 29    property under this chapter shall report to the administrator  concerning  the
 30    property as provided in this section.
 31        (2)  The report must be verified and must include:
 32        (a)  Except  with respect to traveler's checks and money orders, the name,
 33        if known, and last known address, if any, of each  person  appearing  from
 34        the  records  of the holder to be the owner of property presumed abandoned
 35        under this chapter;
 36        (b)  In the case of unclaimed funds of fifty dollars ($50.00) or more held
 37        or owing under any life or endowment insurance policy or annuity contract,
 38        the full name and last known address of the insured or  annuitant  and  of
 39        the  beneficiary according to the records of the insurance company holding
 40        or owing the funds;
 41        (c)  In the case of the contents of a safe deposit box or other  safekeep-
 42        ing  repository  or of other tangible property, a description of the prop-
 43        erty and the place where it is held and may be inspected by  the  adminis-
 44        trator and any amounts owing to the holder;
 45        (d)  The  nature  and  identifying  number,  if any, or description of the
 46        property and the amount appearing from the records to be due;
 47        (e)  The date the property became payable, demandable, or returnable,  and
 48        the  date  of the last transaction with the apparent owner with respect to
 49        the property; and
 50        (f)  Other information the administrator prescribes by rule  as  necessary
 51        for the administration of the provisions of this chapter.
                                                                        
                                           5
                                                                        
  1        (3)  If the person holding property presumed abandoned and subject to cus-
  2    tody as unclaimed property is a successor to other persons who previously held
  3    the  property  for the apparent owner or the holder has changed his name while
  4    holding the property, he shall file  with  his  report  all  known  names  and
  5    addresses of each previous holder of the property.
  6        (4)  The report must be filed before November 1 of each year as of June 30
  7    next  preceding,  but the report of any insurance company must be filed before
  8    May 1 of each year as of December 31 next preceding. On written request by any
  9    person required to file a report, the administrator may postpone the reporting
 10    date.
 11        (5)  All holders of property presumed abandoned under  this  section  that
 12    know  the  whereabouts  of the owner of such property shall, before filing the
 13    annual report, communicate with the owner and take necessary steps to  prevent
 14    abandonment  from  being presumed. Not more than one hundred twenty (120) days
 15    before filing the report required by this section, the holder in possession of
 16    property presumed abandoned and subject to custody as unclaimed property under
 17    this chapter shall send written notice to the apparent owner at his last known
 18    address informing him that the holder is in possession of property subject  to
 19    this  chapter  if  the  holder  has in its records an address for the apparent
 20    owner which the holder's records do not disclose to be inaccurate.
 21        (6)  The written notice required under this section shall include the name
 22    and address of the apparent owner, the nature and amount of the property  pre-
 23    sumed abandoned in the holder's possession, the name and address of the holder
 24    of the property presumed abandoned, a request that the apparent owner identify
 25    whether  the property presumed abandoned is or is not unclaimed property under
 26    this chapter, and the reasons therefor, and any other criteria the administra-
 27    tor deems appropriate.
 28        (7)  If the apparent  owner  completes  and  returns  the  written  notice
 29    described  in  subsection  (6) of this section to the holder, and the apparent
 30    owner indicates a claim to the property presumed abandoned or  indicates  that
 31    the  property  identified in the written notice is not abandoned property, the
 32    holder need not pay or deliver the property  to  the  administrator,  and  the
 33    property shall not be considered abandoned.
 34        (8)  In  the event a holder receives a written notice as described in sub-
 35    section (7) of this section demonstrating that certain property is  not  aban-
 36    doned, a new presumption of abandonment may arise for such property due to the
 37    passage  of  time.  The  date  the holder receives the written notice shall be
 38    deemed the date such property became payable or distributable for the purposes
 39    of calculating whether a presumption of abandonment has arisen.
 40        (9)  A report filed pursuant to this section shall be presumed accurate if
 41    the holder has maintained adequate records sufficient to establish by  a  pre-
 42    ponderance of evidence that each item on the report is accurate and correct.
                                                                        
 43        SECTION  7.  This act shall be in full force and effect on and after Janu-
 44    ary 1, 2003.

Amendment


                                                                        
                                                                        
  ||||              LEGISLATURE OF THE STATE OF IDAHO             ||||
 Fifty-sixth Legislature                  Second Regular Session - 2002
                                                                        
                                                                        
                                                     Moved by    Bunderson           
                                                                        
                                                     Seconded by Marley              
                                                                        
                                                                        
                                       IN THE SENATE
                              SENATE AMENDMENT TO H.B. NO. 439
                                                                        
  1                                  AMENDMENTS TO BILL
  2        On page 1 of the printed bill, delete lines 18  through  43;  on  page  2,
  3    delete  lines  1  through  10; and renumber the remaining sections of the bill
  4    accordingly.
                                                                        
  5                                 CORRECTIONS TO TITLE
  6        On page 1, in line 2, following "LAW;" delete the remainder of  the  line;
  7    delete  line  3;  and  in  line 4, delete "CHECKS AND MONEY ORDERS AND TO MAKE
  8    TECHNICAL CORRECTIONS;".

Statement of Purpose / Fiscal Impact


                           STATEMENT OF PURPOSE

                               RS 11469 

This bill changes the time period before which certain types of 
unclaimed property will be deemed abandoned and become subject to 
the custody of the state. It also modifies the reporting period for 
insurance companies.  These changes will conform Idaho's laws to 
those of most other western states.  The intent is to simplify 
reporting by businesses doing business in two or more states.  

                         FISCAL IMPACT

The bill will result in a one-time acceleration of funds to the 
unclaimed property account of an estimated $500,000 to $1,000,000.

CONTACT

Name:  Dan John / Ted Spangler
Agency: Revenue and Taxation (Idaho State Tax Commission)
Phone: 334-7530

Statement of Purpose/Fiscal Impact          H 439