California’s voluntary compliance program is now open

It’s official: The California unclaimed property voluntary compliance program (VCP) is now open. The state has set a July 31 deadline for initial enrollees to complete the required training as the first step in the process. Join this discussion to learn how to navigate this program and the opportunities it might present to your organization.

On March 15, California officially opened its unclaimed property VCP, allowing companies that have unclaimed property filing gaps (or have never filed) to come into compliance without penalty. The program will allow companies to avoid the state’s mandatory 12% interest assessment (per year) on any amounts disclosed and will help them reduce exposure in the event of a future state exam, as signs point to increased unclaimed property audit activity in California.

The state’s Assembly Bill (AB) 466, effective Jan. 1, 2022, authorized the California Franchise Tax Board to require taxpayers to disclose information related to prior unclaimed property reporting history, or lack thereof. This legislation also allows those disclosures to be shared with the state controller’s office and the unclaimed property division, which presumably will review the information to determine potential noncompliance. Another indication that increased scrutiny is imminent came with the California Legislative Analyst’s Office report on the 2019-2020 budget, which noted that only 2% of companies doing business in the state are compliant with unclaimed property reporting requirements and recommended actions to increase compliance with the state’s unclaimed property law.

Although the prospect of increased audit activity and interest assessments for noncompliance is daunting, this VCP would provide organizations a rare opportunity to come into compliance with unclaimed property requirements while reducing their financial burden.

After attending this webinar, you should be able to:

• Provide an overview and timeline of the recent changes to California’s unclaimed property law and the newly enacted VCP
• Explain the benefits of the VCP and how it can help your organization avoid penalties and interest and reduce audit exposure
• Determine if your organization meets the state’s eligibility requirements to participate in the program
• Outline a plan of action and specific next steps to apply for the program, complete the required compliance activities, and submit the final report within this accelerated timeline
• Recognize the importance of ongoing compliance post-VCP to mitigate future unclaimed property risks

The deadline to opt in to the VCP is quickly approaching, so don't wait to take action. Register now to secure your spot and gain helpful insights to navigate the changing California unclaimed property landscape.