Unclaimed electronic gift cards and stored value cards along with paper gift certificates amount to $8 billion to $9 billion annually nationwide. While a trend for state governments to audit these amounts occurred in the 1990s, now federal auditors are targeting retailers’ income from unclaimed gift cards, with the IRS recently issuing a Field Attorney Advice and an Industry Director’s Directive. John A. Biek, in an article in the Journal of Passthrough Entities, explains the evolution of unclaimed property laws and audits and offers insight regarding questions federal auditors will be examining.
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This story is from the CCH’s monthly Focus on Tax newsletter, which provides advise and guidance on federal and state tax issues for tax and accounting professionals.
Read this article from CCH’s Journal of Taxation of Financial Products