Have you ever thought that there might be money in your buildings or neighborhoods that you don’t know about? The Unclaimed Property Act in Illinois says that there might be. In fact, one out of every four people in Illinois finds money waiting for them when they check the state’s database of unclaimed cash. The average claim is about $1,000. The Illinois State Treasurer has more than $5 billion in unclaimed assets. This law, revised in 2017, is Illinois’s law to protect consumers from money left behind or “unclaimed.” It applies to anyone who has other people’s money, like condo or HOA boards, landlords who collect security deposits or delinquent rent, and real estate investors.
If your rental or association firm contains checks, deposits, or credits that owners or tenants haven’t handled in years, that cash may be “unclaimed property.” Some common instances are checks for refunds that haven’t been cashed, security deposits, vendor overpayments, or even remaining money after a foreclosure or eviction.
For example, unpaid dues refunds, remaining tenant deposits, or credits after a foreclosure sale all count. If the rightful owner goes missing and doesn’t claim the money after a few years, Illinois law takes over. Basically, any money that someone owes that lies about without being used becomes the state’s responsibility until the owner steps forward.
Who Must Comply (HOAs, Landlords, Investors)
The rule clearly applies to real estate investors, landlords and rental property owners, and community groups (condos, HOAs, townhomes, etc.). If you are in charge of a condo association’s bank account or rent out homes, you should pay attention. According to HOA, the Unclaimed Property Act is a statute that protects consumers and gives responsibilities to “condominium, homeowner (HOA), and townhome associations; landlords, rental property, and multifamily building owners.”
Why it matters: Illinois law says that if your neighborhood organization or rental business has old money that it can’t pay back, someone will come looking for it someday. You have to either give it back or carefully give it to the state. If you don’t, you might have to pay fines or interest later. So even though it can feel strange to “turn in” a few hundred dollars, following the law will keep you and your neighbors safe in the long run.
What Counts as “Unclaimed” Property?
This law defines “unclaimed property” as almost any financial asset that someone owes but hasn’t claimed. Think of checks that haven’t been cashed, security deposits, vendor or payroll checks that haven’t been cashed, customer refunds, the contents of a safety deposit box, and so on. Examples that are especially important for landlords and associations are:
- Security deposits or prepaid rents left by tenants who have vanished.
- Uncashed refund checks (for example, an owner overpaid HOA dues and never cashed the check).
- Vendor or contractor credits (like an overpayment on a repair invoice that wasn’t reclaimed).
- Surplus from foreclosures/evictions – e.g., if a unit is foreclosed and the association sells it for more than is owed, the extra funds are unclaimed property.
To put it simply, any “unclaimed assets (Illinois)” that you have on your books could be covered by this law. If your records reveal that someone owes you money and that person hasn’t come forward in years, you should approach it as a possible unclaimed asset.
When Is Property “Abandoned”?
When money is considered abandoned and must be reported, Illinois law is very explicit. If no one claims property within three years of it being payable or demandable, it is usually considered “abandoned.” In real life, that implies that if an owner or tenant had the right to this money and you issued a check (or retained a deposit) and didn’t hear from them for three years, it’s considered unclaimed.
For instance, let’s say an owner pays too much in association dues and you send them a check for the difference on January 1, 2020. If the owner doesn’t cash it and you can’t get in touch with them, you have to declare that money as unclaimed by January 1, 2023. Or think about how you evicted a renter in 2021 and got extra rent that went into an account. You need to notify it if that tenant hasn’t claimed the extra money by 2024. Most sorts of property are turned off after three years of not being used.
Your responsibility begins as soon as the property is thought to be abandoned. This often happens after a foreclosure or sale of property when there are still unpaid bills. For instance, if an organization collects rent to fulfill the dues of an owner who is behind on their payments but then departs, any extra money in that account becomes unclaimed property. If the owner isn’t found within three years, the law specifies that the extra money must go to the State Treasurer.
How to Stay Compliant (Identify, Notify, Report, Deliver)
Don’t worry; following the rules is easy. For an association or landlord, the main actions are to find, tell, report, and pay. In practice, you should:
- Find any accounts or credits that are not being used. Every year, go over your financial records to look for things like checks that haven’t been cashed, old security deposits, vendor refunds that haven’t been paid in a long time, and so on.
- Send a notice of due diligence. Before you turn anything in, Illinois law says you have to try to get in touch with the owner. Send a letter to the owner’s last known address telling them about the money that hasn’t been claimed. This letter is often called a “due diligence letter.” This provides them a chance to speak up.
- Send in an Annual Report. Every year, you have to send a report to the Illinois State Treasurer about the property you are giving up that no one wants. The Treasurer’s office gives out forms and directions. You may still have to file a “zero report” even if you don’t have any unclaimed property that year.
- Give the property. Last, send the money (or asset) to the State Treasurer’s Unclaimed Property office. Usually, this is done with a check or an electronic transfer. The Treasurer keeps the money until the proper owner (or heirs) comes to get it.
In short, approach it as an official process: write down the discovery of unclaimed money, try to contact the owner, and then report it and provide it to them before the deadline. State rules are severe, but if you obey them, you won’t have to deal with problems later.
What if You Don’t Comply?
You might want to just put that neglected deposit in your general fund. Don’t. Illinois takes this very seriously. The state can levy interest on the amount and give you fines if you don’t report or turn in unclaimed property. They might even look at your books. Legal updates say that not following the rules “can lead to interest charges on the property amount due” and other punishments. An audit or legal problem could cost your firm or association a lot more money, which is much worse. In real life, it’s usually easier and cheaper to obey the rules.
Keep in mind that giving the money isn’t the end of the tale; owners can still get it back from the Treasurer later. The state keeps all unclaimed money forever and gives it back to the legitimate owners (or heirs), no matter how long it takes. So by following the rules today, you’re keeping your community safe and enabling the owner take the last step to get what’s theirs.
State Treasurer’s Role and Auctions
The Illinois State Treasurer gets all the money that isn’t claimed. The Treasurer is in charge of misplaced or forgotten assets through the I-Cash program. Michael Frerichs, the Illinois Treasurer, is in charge of this program, which is basically the state’s place to keep unclaimed property. The good news is that owners can get their money back by searching for their name on the I-Cash website. Even better, around 25% of adults in Illinois look for something of value.
But if the owners never come forward, the state may finally sell some things at auction. You read that right: Illinois really does have a State of Illinois Unclaimed Property Auction. When no one claims an item or collectible, it becomes an auction lot. For instance, a recent story from CBS Chicago said that the Treasurer’s office sold baseball and basketball trade cards (including cards of Michael Jordan and Kobe Bryant) and other historical items that no one had claimed. These auctions frequently sell off things that aren’t cash, yet the money still goes into the fund for unclaimed property.
If you owe someone money, you should claim it before it’s too late. For holders like you, the auction part is more of a trivia question. Just keep reporting the cash and deposits you have.
Protect Your Property and Stay Compliant with 23 Legal
It’s best to ask now if you’re not sure if your rental or association business is entirely compliant than to rectify a problem later. Get in touch with Ben Weaver. 23 Legal helps people, families, community groups, and small business owners in the Chicagoland area with real estate and estate planning. You may avoid expensive mistakes tomorrow and keep your real estate business on strong legal ground by getting clear, useful legal advice today.
FAQs
The Revised Uniform Unclaimed Property Act is the law in Illinois that says businesses, associations, and other groups must disclose and give the state “abandoned” financial assets. Some people call it an Illinois law about abandoned property for money. The purpose is to keep consumers safe by keeping unclaimed money in one place until the owners come to get it.
Anyone who has money for someone else. For our purposes, it includes condo and HOA associations, landlords (for security deposits, refunds, etc.), property managers, and real estate investors. Holders can be businesses and suppliers, but here we’re talking about people who work in real estate.
Someone owes money on almost every financial asset. Some examples are cheques for rent or refunds that haven’t been cashed, unused security deposits, overpayments on bills, gift card balances, stock dividends, insurance payouts, and so on. For rentals, think about last month’s rent and security deposits. For HOAs, think about refunds for leftover assessment payments or sales fees.
Most of the time, after three years of not doing anything. If the owner of property in Illinois hasn’t contacted you within three years of the money being due, the property is assumed to be abandoned. If a tenant takes off with a $300 deposit and doesn’t collect it for three years, you should tell someone. Most people who don’t have a bank account have to file the report and pay by November 1 each year. However, verify the state’s timetable because it can change.
If you don’t file by the due date, which is normally November 1, the state may charge you interest and penalties on the amounts you didn’t report. They might also look into your group’s finances again later. It’s always better to do it right the first time because it saves time and money.
The Illinois Treasurer has an online I-Cash database that owners (or heirs) can search. They file a claim if they locate a match. About one in four people who seek I-Cash in Illinois find money. The state pays out the money once a claim is approved. So, if holders follow the rules, owners will eventually get their money back through the state scheme.
Yes, but mostly for fun information. Illinois sometimes sells items or jewels that no one has claimed for a long period at auction. Some examples are old coins, jewelry, or mementos. The Treasurer’s office held an auction in January 2026 for things like tickets to the 1893 World’s Fair and Michael Jordan trade cards. This doesn’t immediately affect you as the holder (landlord or organization). Just know that the state may sell unclaimed non-cash items once all legal claim periods have ended.
Why Choose 23 Legal
23 Legal offers Real Estate and Estate Planning legal services to individuals, families, community associations and small business owners throughout Chicagoland. We know how intimidating “the law” can be. In fact, when most people think of law offices, they think of stuffy leather chairs, huge wooden desks and pompous lawyers who charge outrageous fees. That’s not us! We believe in 1-to-1; the same lawyer should work with you all the way through. Whether you have an estate planning issue, family trust concern, or you have a legal problem in regard to a new home, business, real estate or remodel, you need a lawyer who cares. That’s where Ben comes in! We are great listeners; more than that, we are lawyers who believe that our clients always come first.
