Uncollected Assets: Five Ways to Recover Funds You Didn’t Know You Had
What would your organization do if you discovered a budget surplus? The effect and potential reach of those funds in your community could be astronomical. While strategic fundraising can help your bottom line, it doesn’t compare to a sizable, straightforward donation or windfall. But what if the donation or payment is unclaimed—or worse, you don’t even know it exists? Your surplus could be waiting for your action right now.
It’s common for individuals or family trusts to incorporate nonprofits as heirs to all or part of their estate. Connecting nonprofits to willed funds is complicated, and assets are often left unclaimed in government accounts.
In addition to every state having a depository of dormant funds that companies remit, there are thousands of government agencies in this country, all of which pay money to others, with a percentage of that money going unclaimed as well.
Here are a few actions to take to help you recover potential unclaimed money.
- Get Everyone on the Same Page
Your organization likely has people working on different initiatives that may be running parallel or even contrary to each other. You don’t want to duplicate efforts by pursuing assets that a colleague is already handling. You also don’t want to claim assets that your organization has good reason to not want, for legal or other reasons. Make sure you’re not redoubling anyone’s efforts, stepping on toes or creating headaches for your colleagues by filing claims for unwanted funds.
- Know Your Names
You’re most likely doing automated searches at agencies where you think you have funds. It’s also important to conduct multiple broad and focused searches with each agency. You need to be concise because if one letter is incorrect, you may miss a match. At the same time, you’ll want to search for various name permutations, including acronyms. You also should search for any names associated with your organization, such as names of divisions (think graduate schools or colleges within universities) or predecessors in interest (this is common for health systems that have bought and/or merged with other organizations).
- Search Nationally
The lowest hanging fruit for finding and claiming money is the unclaimed property division(s) for the state(s) where you have a physical presence. Just relying on one or two such searches may result in leaving money on the table. If your nonprofit has a relationship with an entity in another state and that entity has money for you, by law it should remit the funds to your state treasurer. It’s common for holders—the legal term for entities remitting unclaimed property to the states—to take a shortcut and just remit all funds to their home states. It’s also common to find sizable deposits in one state for a nonprofit in a different state.
- Think Outside the Box
Assuming, as is very common, that your nonprofit has financial interactions with government agencies, whether they’re federal, state, county, municipal or otherwise, any one of those agencies may have outstanding checks for you. Don’t rely on them sending the money to an unclaimed property division. States have various exemptions from unclaimed property requirements, including for business-to-business transactions and money in the possession of governmental entities.
- Check Periodically—It Could Pay Off!
If John Q. Public left part or all of his estate to your nonprofit and a probate court admitted the will, you’re likely entitled to that same percentage of assets that surface in John’s name, even years after he died and his probate estate is closed. It could pay to periodically check for money owing to John.
It’s a no-brainer to claim donations, so make sure you take the necessary steps to claim the ones you may not be aware of. While these are just starting points, they’ll hopefully help you add to your nonprofit’s bottom line, all at no cost.