How can stale-dated checks impact your business?

stale dated checks

If you’ve been given a check, it’s best to cash or deposit it as soon as feasible. If you hold onto a check for a while you run the risk of the account number or routing number changing or the check writer may have forgotten about the check and spent the money on something else. If the owner says that the check is lost, or you notice that it has become a stale check, you’re going to need to issue a new check. In addition to creating a new check, you should also issue a stop payment on the old check.

stale dated checks

Personal, business, and payroll checks are good for 6 months (180 days). Some businesses have “void after 90 days” pre-printed on their checks. Most banks will honor those checks for up to 180 days and the pre-printed language is meant to encourage people to deposit or cash a check sooner than later.

Stale Dating Checks

Unclaimed Property is anything negotiable that has monetary value. In the case of the University, most unclaimed property is uncashed checks issued by various departments. State law requires that all checks two years or older be reported to the Department of Revenue.

This latest act empowers the adopting states to review virtually any general ledger category within a corporation’s chart of accounts for possible property subject to escheat. Make sure to review your bank statement to ensure no checks you’ve written go stale. If a check you wrote is approaching bookkeeping for startups the six-month mark but still hasn’t been cashed, you’ll be able to spot it so that you can get in touch with the recipient. Checks which are at least 180 days old (6 months) are considered stale. Tellers in banks will sometimes reject a check if the date is over that limit.

Give the check writer a heads-up

If you’ve been given a personal or business check, it’s important to understand the check validity period. Most personal checks have a maximum time-frame that they can be presented to a bank before they become stale, which is usually 180 days (6 months) from the date on the check. A stale check is an undeposited or uncashed check that may be too old to be processed by a bank, credit union, or other financial institution.

stale dated checks

A check is usually payable at the time it is negotiated or presented to a bank for deposit or cash; however, a person may no longer be able to deposit or cash a check after it has become stale-dated. To request re-issuance of a check from this period, please complete our Stale Check Reissuance Form as indicated and return it to our office using our webform. The form must be signed by the payee and cannot be signed by a University employee on their behalf. Cheques are considered stale-dated after six months, unless it is a certified cheque.

What Can I Do If A Bank Does Not Accept A Stale Check?

List the voided check as a negative check on the treasurer report. While no motions are needed to void a check, motions are needed to reissue, especially if the check was issued in a previous term. Some programs, such as MyPTEZ, record the “Void” with the current date. Check the program currently in use to determine how to best void checks. Another thing you can do to prevent a stale check from clearing is to freeze your account.

  • This letter must be sent between May and August with a response due date on or before September 30th to enable us to meet the October 31st reporting deadline to the State.
  • Though you want to avoid letting a check go out of date, there are some important considerations for a check that has become outdated.
  • After 1-3 years, Western Union will charge a fee against the value of the money order.
  • The IRS needs to reissue the check if it has been sitting around for longer than a year.
  • A stale-dated cheque means that the item is old, and not necessarily invalid.

If the company does not cash the check, you’re going to have to go through the escheatment process, and you’ll end up losing the cash either way. If your bookkeeper or accountant sees that you have a check that’s approaching expiration, you should be diligent in contacting the other business and encouraging them to cash the check. Almost every state requires a business to perform due diligence by contacting the owner of the unclaimed property.

Banks are still allowed to process an old check as long as the institution believes the funds are good. A Federal Reserve regulation says a bank does not have to deposit a check if it has reason to doubt that it will be able to collect the money from the paying bank. Consider the type of unclaimed property you could potentially have and investigate the state dormancy period for each.

Before trying to cash a stale-dated check, it might be a good idea to contact the bank that holds the account the check is drawn against to see what its policy is. Treasury (a federal tax refund, for example) are good for 12 months after the date they’re issued. A check from a state government is generally valid for six months to a year, though that can vary by state. If there is a message on the screen stating STALE DATED it means the check has been placed in the stale date suspense account by Procurement Services. Due diligence letters are sent by Procurement Services for checks issued in the amount of $75.00 or more. Recipients of lost or destroyed checks are responsible for requesting that the check be reissued within six months; but no later than the end of the fiscal year in which the check was issued.

Please note that checks over two years old cannot be replaced immediately. If a check remains uncashed after two years, it becomes unclaimed property which is then turned over to New York State. Please email if you have an uncashed check that is older than two years.

  • There are a few things a person can do to prevent a stale check from being honored by a bank.
  • If the company does not cash the check, you’re going to have to go through the escheatment process, and you’ll end up losing the cash either way.
  • The only exception to stale-dating may be a certified check, which must be honored, even after 180 days.
  • The length of time that a check is considered to be valid will vary from state to state.
  • Once your Stop Payment form has been received, the Payroll Office will reissue your payment within 3-5 business days.

Contact the issuer of your money order to find out if they have an expiration date or charge fees against old money orders. After 1-3 years, Western Union will charge a fee against the value of the money order. U.S.P.S. money orders do not expire and retain their value indefinitely. As long as there are post offices, you can cash a U.S.P.S. money order. Cashier’s checks are a special type of check and they’re typically used for larger transactions. Read our article about What’s a Cashier’s Check if you’d like more information about cashier’s checks themselves.

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