California Proposes Unclaimed Property Voluntary Disclosure Agreement (VDA) Program – (Assembly Bill 2773)

April 2018

Summary

After nearly two decades, the state of California seeks to enact legislation to allow for submission of past due unclaimed property without companies having to incur interest and penalties. Current law precludes the state Controller’s office from waiving interest on past due unclaimed property. This new law would require the Controller to establish a program for the voluntary disclosure of unclaimed funds to the state. 
 

Key Details

The list below summarizes some of the key highlights of the bill.
  • Requires the Controller to establish a VDA program
  • Companies will be required to execute a participating agreement with the Controller
  • A VDA will have a look-back of 10 report years from the date the company was accepted into the program
  • The timeframe for completing a VDA is 12 months, unless otherwise agreed to by Controller
  • Interest and penalties waived if VDA is filed in good faith
  • VDA not available for companies under audit by the state   
  • State will agree not to audit a company participating in a VDA unless it is determined the VDA was filed fraudulently or with willful misrepresentation
  • Program sunsets January 1, 2024
 

BDO Insights

As the 5th largest accounting firm in the world, we pride ourselves in serving our clients in addressing their accounting, tax and business needs. Our team of over 20 unclaimed property professionals across the country are seasoned veterans in escheatment space with strong working relationships with various state escheatment offices.  We can provide our clients with compliance, policy and procedures, voluntary disclosure filings, audit defense, global mapping, refund reviews and escheat consulting. Let us know how we can assist you.
 

For questions related to matters discussed above, please contact:
 
Ricardo Garcia
Managing Director, West Region Unclaimed Property Practice Leader

Joe Carr
Partner, National Unclaimed Property Practice Leader