Utah Treasurer David Damschen, Senator Lyle Hillyard (R – Logan), and Representative Lowry Snow (R – St. George) applauded the final passage of SB 175.
This legislation protects Utahns’ individual property rights and modernizes Utah’s 1981 unclaimed property law to better fit today’s technology – including requiring businesses and other organizations to encrypt Utahns’ personal information when reporting lost or abandoned property to the State of Utah.
“Replacing our outdated Unclaimed Property statute is a great accomplishment and I commend our legislature for unanimously supporting this effort. That said, there are certain changes in the law related to properties held by the banking and insurance industries that we may still have to make – and we will work on those issues in the coming year,” said Treasurer Damschen. “These areas involve certain prepaid debit card account balances that could become lost – and situations involving the death of an individual with life insurance whose beneficiaries are unaware of the policy and therefore fail to claim it – all of which should be covered by unclaimed property law.”
“For over two years the Uniform Law Commission worked closely with state treasurers, the National Association of Unclaimed Property Administrators, and industry representatives to ensure all affected parties’ interests were carefully considered in this legislation – and then we spent the last months doing the same here in Utah,” added Senator Hillyard. “This legislation goes a long way to protect individual property rights in Utah.”
Highlights of SB 175 include but are not limited to:
Explicitly requires personal information reported to the Unclaimed Property Division by holders be encrypted to protect the identities of Utah’s unclaimed property owners.
Defines virtual currency for the first time in Utah’s unclaimed property statutes. Expressly provides coverage of new and evolving payment mediums.
Removes mandatory distribution requirements for triggering the commencement of the abandonment period for retirement plans and creates reporting criteria for Roth IRAs.
Expands standards of owner contact including certain types of online activity, including account balance inquiries. Reflects the reality that owner contact occurs electronically and not just in verbal or written form which may reduce the instances where items are reported to the state inappropriately.
Creates abandonment parameters for college savings and other tax-deferred investments where distributions are not mandatory.
Expressly authorizes an offset against an approved claim for owner obligations, including child support, taxes and civil judgments. Ensures that an owner’s debts and obligations due third parties are satisfied.
Changes a 1981 vintage 12 percent interest rate charge for late reporting of unclaimed property to a floating rate more in line with interest charges for late filing of Utah State income tax returns.