Tax-deferred savings accounts such as IRAs are different than most other forms of unclaimed property because their raison d’être is to be saved for decades, until the owner is ready to retire. For this reason almost all jurisdictions have laws requiring that retirement accounts not be reported until the owner has reached the age at which distributions are required to avoid a tax penalty. For a traditional IRA, the IRS has set this age at seventy and a half. (The April 1st following the year the owner reaches age seventy and a half, to be precise.)
Except for Pennsylvania.
In 2016, Pennsylvania adopted a new unclaimed property law that, to the confusion of all, neglected to include any mention of the seventy-and-a-half rule. As written, the law treats retirement accounts the same way it treats any other piece of unclaimed property—if the holder hasn’t had contact with the owner for three years, the holder must report that property to the state.(more…)