Illinois RUUPA – SB 9
On July 6, 2017, Illinois appropriation budget bill S.B. 9 became law. The Governor had vetoed the bill, but both Senate and House voted to override the veto. One of the measures added to the bill was the Illinois Revised Uniform Unclaimed Property Act, which repeals the state’s current unclaimed property statute and replaces it with new language. The effective date for this law is Jan. 1, 2018. However, there is activity in progress to repeal this provision.
Some provisions of this bill include:
- A new definition of “virtual currency,” and it includes a list of escheatable property.
- New definition of escheatable “property” specifically excludes game-related digital content, loyalty cards and gift cards.
- Definition of stored-value card excludes loyalty cards and game-related digital content, but does include gift cards. (This may be a concern for holders as stored-value cards are escheatable property. The conflicting definitions results in conflicts for holders that deal with gift cards.
- Tax-deferred accounts considered abandoned under the new statute 3 years after either the required distribution date, or the 30th anniversary of the account’s opening date—whichever is earlier. Earlier abandonment dates are specified for deceased owners of these accounts.
- Includes health savings accounts in the tax-deferred account provision.
- Provisions regarding custodial accounts for minors.
- Requirements to maintain records for 10 years, including unclaimed property report information; date, location and circumstances that led to the property rights; property value; last-known owner address; details for items that were not reported as unclaimed; and details related to money orders, traveler’s checks and similar instruments.
- A “transitional provision” that requires holders to file an initial report for property that was not previously reportable, but which will be reportable under the new statute for a period of five years from the effective date (Jan. 1, 2018).
- Excluded from the new law is the state’s current business-to-business unclaimed property exemption.
Before S.B. 9 passed, efforts to repeal the Illinois RUUPA provisions were already in process. On July 3, 2017, Rep. David McSweeney introduced H.B. 4078, which states that if S.B. 9 becomes law, the Illinois RUUPA provisions contained in S.B. 9 will be repealed, effective immediately. If passed, the state’s current unclaimed property law, the Uniform Disposition of Unclaimed Property Act, would remain in effect. Before the Illinois legislature’s recess, 19 representatives signed on as co-sponsors of the bill.
UPCR will keep you posted as events unfold regarding this legislation.