Business owners 7&4 spoke with are confused with the law
GAYLORD, MI -- It’s like a state-wide lost and found.
Did you know by law, businesses and governmental entities are to turn over unclaimed property to the Michigan Department of Treasury?
The Unclaimed Property Act is used as a database for people to claim items they may have forgotten about, like a paycheck or a necklace from a safe-deposit box.
Changes have been made for the state to increase revenue this fiscal year.
"I think it is a big waste of time and effort on the business owner," said Matt Coger.
Matt Coger is owner of Spicy Bob's Italian Express. He received a letter from the Michigan Department of Treasury about changes in the Unclaimed Property Act; something he didn't know existed in the first place.
"I would say most would probably ignore the letter and like me not understand what it meant to begin with, and just throw it away," said Coger.
He's right.
"We have not seen wide-ranging compliance on this. Clearly, this is an educational effort, and I think that's an important piece of this," said Terry Stanton, the spokesperson for the Michigan Department of Treasury.
The Michigan Department of Treasury sent letters to businesses explaining the changes -- the due date to report unclaimed property has been moved to July 1st and the dormancy period for some properties, like bank accounts or stock holdings, has been cut to three years compared to five. For unclaimed paychecks, they still need to be turned over to the state after one year of dormancy.
"Last year, the legislature passed this as a budget fix bill, to address the 2011 budget," said Stanton.
The plan is by moving the due date up and decreasing the dormancy period, the state will bring unclaimed money in and put it in the general fund until it's claimed -- which is an estimated $166-million.
“The money is not theirs, they're just simply holding it for the third party it belongs to, but they get to use it?" asked Coger.
But for business owners like Coger, this doesn't make much sense at all. He doesn't agree with the fact that somebody else's money that was once his is the states if the person doesn't claim it. But if he fails to file a report and gets audited, the fines are significant. The owner will be responsible for the interest and have a 25 percent penalty.
If you're a business owner and you'd like to learn more about this law by reading the manual released by the state, CLICK HERE.
For the Michigan Department of Treasury website and to see if you have unclaimed property in their database, CLICK HERE.
