The Unclaimed Property and Tax Risk Advisory team at Duff & Phelps has learned that the Delaware Secretary of State sent 200 unclaimed property voluntary disclosure agreement (VDA) invitations to Delaware incorporated companies throughout the United States on February 15, 2019.
By law, recipient companies must respond to these notices within 60 days, or they will be referred to the Delaware Department of Finance to commence an unclaimed property audit. Traditionally, Delaware uses third-party, contingently paid, multistate auditors to conduct unclaimed property audits.
It has been our experience that notifications from Delaware are addressed to C-Suite executives and often do not reach appropriate parties in time to prevent an audit. We believe it is crucial for all senior accounting or tax professionals at Delaware-incorporated companies throughout the United States to make immediate inquiries to both the CFO and mail room staff to determine if such a notification has been received.
As we reported last year, Delaware unclaimed property VDA invitations were mailed to over 100 U.S. corporations in October 2018. We further reported that Delaware intended to send up to 800 to 1,000 invitations in 2019, beginning in the first quarter.
Additionally, we announced that audit notices were sent by the Delaware Department of Finance on January 3, 2019. These notices were sent to corporations that received, but did not respond to, the October 2018 Delaware unclaimed property VDA invitations.
Any corporation that receives a notice from either the Delaware Department of State or the Delaware Department of Finance is encouraged to contact the Duff & Phelps Unclaimed Property and Tax Risk Advisory team for a free consultation. Both events are highly sensitive and may have a material profit and loss impact. Our team is highly experienced at guiding our clients through both the Delaware unclaimed property voluntary disclosure and audit programs.
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