The SOS VDA Program creates an efficient and collaborative settlement process for determining the Holder’s past due unclaimed property bringing the Holder into compliance with the Abandoned or Unclaimed Property Law for prior reporting years.
The SOS VDA Program is designed to reach a final agreement on past due liabilities as quickly as possible from the day Holders enters, and no later than two years after the date of enrollment. After entering and completing the SOS VDA Program, Holders that fulfill its future annual reporting requirements are protected against an unclaimed property audit for historic liabilities for the property types and entities reviewed as part of the SOS VDA.
As detailed in 12 Del. C. § 1173, benefits for Holders that enroll in the SOS VDA Program include the following:
The legislation enacted in February of 2017 provides that Holders under audit which were initiated on or before July 22, 2015 may choose within 60 days following the adoption of regulations regarding estimation that are to be promulgated by the Department of Finance (expected on or before December 1, 2017) to (i) have that audit converted to a VDA or (ii) to have the audit fast-tracked to a two-year, expedited process. (See FAQ’s related to Conversion for additional information.)
Holders that have previously enrolled in the SOS VDA Program and formally withdrew, or that the Secretary of State removed for failure to work in good faith to complete the SOS VDA Program are not eligible to enroll.
Holders have enrolled for the following reasons:
A Holder enters into the SOS VDA Program by submitting a signed Form VDA-1. Form VDA-1 may be submitted electronically or by mail as detailed below.
Secretary of State, State of Delaware
ATTN: SOS VDA Program
401 Federal Street, Suite 3
Dover, DE 19901
A copy of the Form VDA-1 can be found on this website on the Steps to VDA page:
Since this is a VDA and not an audit, it is the Holder’s responsibility to do a self-review and present the conclusions consistent with the process outlined in the “Steps to VDA” tab. In this way, Holders have more control over the VDA process and the ability to present its conclusions to the State, as opposed to an audit where the auditor performs the analysis and assesses a liability based on the auditor’s review.
This order of priority is based on rules established by the seminal U.S. Supreme Court case, Texas v. New Jersey, 379 U.S. 676 (1965). Therefore, it is likely that most if not all Delaware legal entities would have some unclaimed property due and payable to the State of Delaware, even if that legal entity has no operations, vendors or customers in Delaware.
Under this section, companies have 60 days from the date the request was mailed to enroll in the SOS VDA Program by completing, executing and submitting a Form VDA-1 Disclosure and Notice of Intent to Voluntarily Comply with Abandoned or Unclaimed Property Law to the Secretary of State. Form VDA-1 is available on this website under “Steps to VDA”. If a company does not formally enroll in the SOS VDA Program within 60 days after the request to enter was mailed, then the company will be referred to the State Escheator for audit.
The Secretary of State expects every VDA enrollee to reasonably estimate liabilities for periods and entities where records are not available to determine a Holder’s unclaimed or abandoned property. See SOS VDA Regulations and Implementing Guidelines for information related to estimation.
When the SOS VDA is presented to the State, each submission will undergo a due diligence/validation process as outlined in the Implementing Guidelines and SOS VDA Regulations. At this time, the Holder may be asked to provide various supporting documentation such as: trial balances, general ledger detail, bank reconciliations and associated back up, voided and outstanding checklists, accounts receivable aging, and remediation support.
When completing the Form VDA-1 Disclosure and Notice of Intent to Voluntarily Comply with Abandoned or Unclaimed Property Law, the Holder has the option of assigning a Holder Advocate who will be assisting the Holder with the VDA. By noting the Holder Advocate on the form, you are providing permission for the Department of State and/or its designees to communicate with the Holder Advocate. If additional Holder Advocates are involved, changed or added, confirmation of such will be required from the Holder in writing (e.g., email confirmation).
Legal Disclaimer: The materials contained herein are intended to provide information in regard to the subject matter covered. The Delaware Department of State is not engaged in rendering legal, accounting, or other professional services. If legal advice or other professional assistance is required, the services of a qualified professional should be sought.