October 26, 2020

Volume X, Number 300

Advertisement

October 26, 2020

Subscribe to Latest Legal News and Analysis
Advertisement

Get Ready for the Countdown: Final Delaware Unclaimed Property Regulations Published

On October 1, 2017, the Delaware Department of Finance published final regulations in the Register of Regulations repealing its former unclaimed property regulations and promulgating a new reporting and examination manual.  See 21 DE Reg 336 (Oct. 1, 2017).  The final reporting and examination regulation contains no substantive changes from the revised version that was re-proposed on August 1, 2017.  As published, the regulations are set to be adopted and take effect on October 11, 2017.

This development is significant for holders that are currently under audit and considering enrolling in the Secretary of State’s Voluntary Disclosure Agreement Program (VDA Program) or converting the audit to an “expedited audit” because October 11 marks the start of the 60-day period allotted for holders to notify the Secretary of State and/or State Escheator of their intention.  See 12 Del. Code § 1172(b)-(c).  At the conclusion of this 60-day period, any holder that has not provided a notice of intention will not be permitted to elect the respective option.  Specifically, the notice must be in writing and received in a form and manner provided by the State Escheator and/or the Secretary of State within the 60-day period permitted by statute.  To be eligible for enrollment in the VDA Program, the audit must have been authorized on or before July 22, 2015.  However, to convert to an expedited audit, the audit must have been authorized before February 2, 2017.

Practice Note

If you are currently caught up in a Delaware unclaimed property audit, the expiration of your window of opportunity to elect another route is right around the corner and the time to act is now.  This comes in light of the news that the Secretary of State will be mailing notices to potential audit targets in two weeks—which also contain a 60-day VDA program enrollment deadline.  Holders are encouraged to contact the authors to discuss the implications of each option and whether VDA Program enrollment or expedited audit conversion makes sense for your audit.

© 2020 McDermott Will & EmeryNational Law Review, Volume VII, Number 278
Advertisement

TRENDING LEGAL ANALYSIS

Advertisement
Advertisement

About this Author

Stephen P. Kranz Lawyer McDermott Will
Partner

Stephen P. Kranz is a partner in the law firm of McDermott Will & Emery LLP and is based in the Firm’s Washington, D.C., office.  He engages in all forms of taxpayer advocacy, including audit defense and litigation, legislative monitoring, and the formation and leadership of taxpayer coalitions.  Steve is at the forefront of state and local tax issues, including developments arising in the world of cloud computing and digital goods and services.  He assists clients in understanding planning opportunities and compliance obligations for all states and all tax types. ...

202-756-8180
Counsel

Diann Smith is counsel in the law firm of McDermott Will & Emery LLP and is based in the Firm’s Washington, D.C., office.  Diann focuses her practice on state and local taxation with an emphasis on tax challenges relating to compliance, controversy, planning and legislative activity.   

202-756-8241
Eric Carstens Tax Attorney McDermott Will Emery
Associate

Eric D. Carstens is an associate in the law firm of McDermott Will & Emery LLP and is based in the Firm’s Washington, D.C., office. He focuses his practice on state and local tax matters.

Eric assists clients with state tax controversy, compliance and multistate planning across all states for a variety of tax types and unclaimed property. He engages in all forms of taxpayer advocacy, including litigation, legislative monitoring and audit defense. He works closely with several of the Firm’s taxpayer coalitions focused on specific state tax...

202 756 8353
Advertisement
Advertisement