How to Recover Unclaimed Inheritance Money

When a loved one dies, the heirs may be unaware that there are forgotten funds sitting out there in the deceased's name.

If family members don't make an effort to claim this money, any unclaimed assets become the property of the state, which can be a tragic loss if someone in the family really needed the cash.

If you suspect that there may be unclaimed assets from deceased relatives, you may want to do a search to find it. You can use free, online databases to search for unclaimed property or hire a professional locator service. 

A search for unclaimed money may involve a bit of detective work, but the financial payoff can be worth it.

What is an unclaimed inheritance?

An unclaimed inheritance is funds owned by a deceased person that have not been claimed by an heir or beneficiary. Potential unclaimed assets include bank accounts, bonds, certificates of deposit, dividend or payroll checks, life insurance policies, retirement accounts, safe deposit box contents, stocks, and securities and utility deposits that are held by financial institutions or holding companies. 

The assets are considered abandoned or dormant if there has been no activity in the account for a period of time, commonly a year or more.

The holder of the property is required by law to contact the owner, yet often makes very little effort to do so. In cases where the owner has died, the holder may be unable to locate the heirs either because of an unreported address change or a name change after a marriage or divorce.

When the heirs fail to claim the property within a specified period of time (the dormancy period) it passes to the state's unclaimed property division, a process known as escheat. The state will hold onto the funds until an heir can be found or a certain amount of time has passed. If no beneficiary comes to claim the property, the funds may be used by the state. Each state and institution has a slightly different process for managing unclaimed money.

It might be hard to imagine, but there are a number of reasons that an inheritance may go unclaimed.

• The beneficiary doesn’t want the funds. Whether for emotional, financial, or social reasons, sometimes an heir doesn’t want to accept their inheritance. If this happens and there is no backup beneficiary listed, then the property will be unclaimed. 
• The beneficiary didn’t know about the funds, asset, or account. Sometimes, a person opens an account without the knowledge of their family or heirs. If this happens, it’s possible that a beneficiary has no idea that the inheritance exists.
• The beneficiary has passed away. If someone dies without a will, the state will process their assets based on its intestate laws. They will start with immediate family members and move to more distant family members if none can be found. If the state can’t find any beneficiaries, the property becomes unclaimed.

How to find an unclaimed inheritance

It's easy for individuals to search for unclaimed funds, thanks to online databases and locator services. You can use your knowledge of your deceased loved one and free, online tools to search for unclaimed funds.  

If you want to do a thorough search, don't just search by one form of your loved one's name. Many state databases require you to enter the name exactly the way it is in the system.

Try different spelling variations, add a prefix or suffix, search under the maiden name, or try using the first initial and last name. You might even want to try adding words like “Beneficiary," “The Estate of," “Payable on Death," “Unknown Heir," or “No Beneficiary."

To claim the money or property of your loved one, you’ll likely need some information. You might need to provide:

• A specific description of the asset
• When and how you expect to inherit the property
• Which agency currently holds the asset

Since there is no single, centralized source for unclaimed property, you will likely need to check in a few different places to find your loved one's unclaimed assets.

Review the deceased’s mail, files, and other paperwork

Sometimes family members open accounts or purchase assets without telling their loved ones. This might happen if someone has dementia and doesn’t remember opening the account, if the purchase of the asset or discussing finances makes them uncomfortable, or if their death was unexpected.

There are many reasons you might not know about an asset your loved one owned.

If you think there’s a chance your loved one had assets you don’t know about, one way to begin your search for unclaimed inheritance is by going through their mail, paperwork, or digital files. If a company isn’t aware that your loved one has died, they may still be sending statements or bills to their address.

To claim the asset, you can contact the company directly. Depending on how long it’s been, they may still have access to it or may have sent it to an unclaimed asset department with a government agency.

Search state government database for unclaimed property

Another way to search for unclaimed inheritance is to search state government databases. Most unclaimed funds are returned to state governments. These might include unclaimed funds from bank accounts, insurance policies, or state agencies. 

For a thorough search, you should check the state government database for any state in which the deceased lived or did business. You can find state databases by searching “unclaimed funds database” and including the name of the state you’re looking for.

Search free online databases for unclaimed property

You can also search free, online databases for any unclaimed property in your loved one’s name. 

The best place to begin your search is www.Unclaimed.org, the website of the National Association of Unclaimed Property Administrators (NAUPA). This free website contains information about unclaimed property held by each state. 

You can search every state where your loved one lived or worked to see if anything shows up. It may be a good idea to search all 50 states and the District of Columbia.

You may find yourself directed to www.MissingMoney.com, where you can do a multi-state search. Also endorsed by NAUPA, this site lets you search for unclaimed property in participating states (which do not include CA, CT, DE, GA, HI, IL, OR, PA, WA, WY).

Don't forget to click on the Links tab and search under Related Links. Here you'll find links to additional searchable databases such as: 

• Financial Management Service
• U.S. Savings Bonds
• IRS
• Pension Benefit Guaranty Corporation
• Housing and Urban Development
• Federal Deposit Insurance Corporation
• Department of Veterans Affairs

Search national organizations’ databases

In addition to state databases, there are national databases of unclaimed funds. Generally, these national databases are for federal government agencies that may have collected funds that have gone unclaimed.

You might want to search for the following types of unclaimed funds:

• Wages and pensions. The Department of Labor and Pension Benefit Guaranty Corporation have tools for finding unpaid pension funds and wages. 
• U.S. securities and payments. The U.S. Treasury offers a Treasury Hunt program to find matured savings bonds that have been forgotten. 
• Insurance payments. You can find unclaimed insurance money from the U.S. Department of Veterans Affairs and Federal Housing Administration (FHA) insurance refunds through the U.S. Department of Housing and Urban Development (HUD). 
• Tax refunds or unclaimed stimulus payments. You may be eligible to claim an unclaimed annual tax refund or stimulus check from the 2020 and 2021 economic impact payments. 
• Bankruptcy payout. If your loved one was part of a bankruptcy case, you may be eligible for unclaimed funds from the U.S. Courts Unclaimed Funds database.
• SEC enforcement funds. After a Securities and Exchange Commission investigation, there may be funds distributed to those harmed. Your loved one may have unclaimed funds from the SEC. 
• Individual Indian Money accounts. The U.S. Department of Interior, Indian Affairs manages the Bureau of Trust Funds Administration (BFTA) which may include unclaimed funds from IIM accounts. 
• Bank failures. You can use the FDIC and National Credit Union Administration databases to search for unclaimed funds due to the closure of financial institutions. 

Use a locator service

If the process of searching for unclaimed money on your own seems overwhelming you can choose to hire help. There are services that offer to search for unclaimed inheritance money for you for a fee. 

NAUPA notes on its website that most abandoned accounts have very little money in them. Unless you have reason to suspect that there is a significant sum of unclaimed money out there or your loved one lived abroad, it makes more sense to conduct the search yourself.

If you do locate funds that belong to you, the state will walk you through the process of how to claim them. Generally, all that is required is your Social Security number and proof that you are the rightful heir.

Hire an attorney

If you feel certain that your loved one has left an unclaimed inheritance for you but aren’t able to find it on your own using free searches, it might be time to seek the help of outside sources. 

An attorney can help you to claim your inheritance. It’s important to weigh the cost of an attorney against how much inheritance you think is waiting for you. You will need to pay the attorney a fee, regardless of whether or not they find and claim your inheritance. 

How to claim an unclaimed inheritance

If you do find unclaimed inheritance while searching state or federal databases, the next step will be to claim those funds. To make the claim that you are the rightful heir to those funds, you’ll need to provide proof or explanation.

Each state and government agency has a slightly different process for claiming funds and that should be stated clearly on the website. In general, you will likely need to prove:

• Information about your identity
• Proof that you are the heir to the person whose financial assets you are claiming

Once your claim and proof have been submitted, there will be a review process before the funds are returned.

Legal considerations

If you locate unclaimed funds that you believe you are the rightful heir to, there are some legal considerations you should assess before making your claim to the missing money.

• Statute of limitations. Some funds have time limitations. If a state agency has held onto the funds for a set amount of time, they may be absorbed and used by the state. You may no longer be able to claim the funds once the statute of limitations has passed. 
• Tax implications. You may be required to pay taxes on any inheritance you receive as it might be treated as income. If you do receive an inheritance, be sure to set some aside for taxes later on.
• International claims. If you live outside the U.S. and apply for unclaimed funds, there may be a complex legal and diplomatic process you must navigate before receiving the funds. 

What happens if someone doesn’t claim their inheritance?

If someone has funds that are ready to be claimed but they either don’t know about those funds or have passed on and can no longer claim them, those funds will become unclaimed funds.

Each agency has a slightly different way of handling unclaimed money. The government agency or company will have a policy to hold onto them for a certain period of time. Once that length of time has passed, most transfer those funds to state or federal agencies. The government agency must then hold onto those funds for a period of time. 

How to keep your property from becoming unclaimed

The best way to keep your property and assets from becoming unclaimed is to create a thorough estate plan, which might include writing a will or setting up a living trust. Your estate plan should clearly lay out your beneficiaries, and the people you want to inherit specific assets and funds.

All adults should have an estate plan, no matter their age. If you have created an estate plan, it’s important to keep it up to date, checking that your beneficiaries are valid every five years or so. An updated estate plan will ensure that your wishes are followed after your passing. Your estate plan should include detailed records of the assets you own, including insurance policies, bank accounts, investments, and debts.

FAQs

What is the most common unclaimed property?

The most common types of unclaimed money include:

• Bank accounts
• Safety deposit box contents
• Uncashed cashier’s checks
• Insurance policy payouts
• Matured bonds
• Stocks or mutual funds

What is the best free website to find unclaimed money?

You should start with government websites. The National Association of Unclaimed Property Administrators or NAUPA also recommends two free websites that have been vetted and are trusted. These include:

• Unclaimed.org
• Missingmoney.com

Both of these websites can help you search for unclaimed funds for free. Once you've located money, the agency that holds it will have a step-by-step guide on how to claim money that's being held.

How do you know if someone left you an inheritance?

You will know that someone left you an inheritance if they tell you, if it’s included in their will or trust, or if you’re named as a beneficiary on an account. 

If you believe someone left you an inheritance but can’t check any of those ways, you can also search for unclaimed funds from their estate by searching free, online databases. 

How long does it take to get unclaimed money?

Once you have located unclaimed money and provided the information required to claim the funds, it can take a few months for the state or government agency to review the information, approve you as the rightful owner, and process the transaction of funds. Each state has a slightly different process, so the length of time it takes will vary.

Roberta Codemo contributed to this article.