Found money refers to any amount of money that has been rediscovered after being forgotten about or abandoned by the rightful owner. Bank accounts, retirement funds that remained with a previous employer and old bonds are examples of unclaimed funds that become found money after being reunited with their rightful owners. State regulations within the U.S. require that found money or unclaimed funds be returned back to the government until claimed by the rightful owner. There are many different forms of unclaimed funds, such as bank accounts, retirement funds that remained with a previous employer; and old bonds. The state comptroller serves as the custodian of unclaimed funds until the money is claimed by the rightful owners.
What is Found Money
Found money refers to any amount of money that has been rediscovered after being forgotten about or abandoned by the rightful owner.
Understanding Found Money
The term "found money" describes anything from a wad of discarded dollar bills one finds in the bottom of a washing machine to an uncollected asset discovered by beneficiaries long after the account holder has passed away. Found money pertains to money that has been lost until it is discovered once again.
Every U.S. state has an unclaimed property agency that works to return forgotten funds to their rightful owners. These funds include forgotten bank deposits, undisbursed retirement funds and even uncashed payroll checks.
Each state has its own policy for how to deal with forgotten funds that go unclaimed. In some cases, this money defaults to state coffers after a certain time period. Some states allow the funds to remain in limbo indefinitely. For example, in New York the Abandoned Property Law requires entities to return unclaimed funds to the state's Comptroller's Office of Unclaimed Funds. The state comptroller serves as the custodian of unclaimed funds until the money is claimed by the rightful owners.
There are many different forms of unclaimed funds, such as bank accounts, retirement funds that remained with a previous employer; and old bonds. Once unclaimed assets are returned to their proper owner, they become "found money."
Example of Found Money
Take for example the case of Fran Goldsmith. Her father Fred passed away in 2001. Fran was the executor of his will and the sole beneficiary of his many assets. It took Fran more than a year to organize all of his accounts. She transferred some of his investments into her name, keeping them open. The ones that she wanted to close were liquidated.
During this process, one of her father's shareholder accounts slipped through the cracks. Over the years, the account remained open and the shares of ABC Fruits remained in Fred's name. In 2017, the company was bought out by a national chain. The company offered to buy out any existing shareholders and tried to track down Fred Goldsmith. Instead they found Fran Goldsmith, the new rightful owner of the shares, and offered her the buyout instead.
Upon accepting the buyout of $5,000 for her father's last remaining account, Fran joked to her friends about how this was more "found money" than she had ever pulled out of her dryer's lint trap.
Abandoned property is an asset that has been turned over to the state after several years of inactivity. read more
A beneficiary is any person who gains an advantage or profits from something typically left to them by another individual. read more
A comptroller is a controller who oversees the accounting operations and financial reporting of government bodies, non-profits, and businesses. read more
Credit Shelter Trust (CST)
A credit shelter trust allows a surviving spouse to pass on assets to their children, free of estate tax. read more
An executor is an individual appointed to administrate the estate of a deceased person. The executor's main duty is to carry out the instructions and wishes of the deceased. read more
Inheritance refers to the assets a person leaves to others after they die. Read about inheritance taxes and the probate process. read more
Qualified Domestic Relations Order (QDRO)
In a divorce, a qualified domestic relations order (QDRO) requires that a portion of retirement account assets be paid over to a former spouse. read more
Reclamation is generally the return of property or money to its original owner after the other party in a transaction fails to meet the agreed terms. read more