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Something All Expats in Mexico Should Know About

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Spencer McMullen blogs on legal matters on Expats In Mexico
Spencer McMullen

Here’s something all expats in Mexico should know about if you have a dormant bank account in the U.S.: if you don’t claim your money within a specific period of time, it will revert to the state.

I had some money in a U.S. checking account that I hadn’t used for a few years. The bank blocked the account and classified it as dormant. Then, recently, I was contacted by a treasure hunter who told me, “You may have some uncollected funds in the U.S. Hire us and we’ll see that you get your money before the government does.” What they were referring to is a law called “escheat,” which allows funds that belong to an account owner who can’t be found to revert to the state government after a period of time.

When I called the treasure hunter back, he asked me for my secret code, which I had forgotten by that time. I almost had to fly back to California, where the account was, to show the bank my identification to get my money back. Luckily, I finally remembered my code, and the bank is now sending me a check.

So, here is a lesson to learn: be sure you keep your account active. Make a deposit, or have someone in the U.S. do it on your behalf, every year on your birthday. You can deposit as little as US$5 to avoid the account going dormant and having your funds being taken by the state.

The average time for an account to be deemed dormant and revert to the state is five years, but some states appear to be getting greedy. They are shortening the five-year time limit.

As an expat in Mexico you should check your home state’s unclaimed funds website to see if any funds are owed to you. Funds may include utility bill refunds, rebates, insurance refunds and dividend or interest payments, for example.

Even if you still live most of the year in the U.S. you may find funds owed to you that can be claimed, so search states where you have previously lived or currently live.  The laws vary by state. Some let you claim the funds electronically and others require submission of paperwork.

You can search online for the state government website where you live or lived that has this information. As examples, here are the websites for  California and for Texas.