Stale Dating Checks Procurement Services

Stale dated checks

This can be safely disregarded as an attempt to remind people not to hold a check for too long. The six-month rule applies regardless of what is printed on the check. Therefore, they always ask for verifications or check reissuance in cases where a stale check has been presented to the bank for encashment. Subsequently, ABC Co. requested Gen X Co. to reissue those checks, or have them verified again by their bank in order for the transaction to process in a smooth manner. However, to his dismay, the bank refused to deposit them and declared that those checks as stale.

Although banks, credit unions, and other financial institutions may allow you to cash or deposit an old check into your account, the law does not force them to. As per the law, usually, the 6-month time frame for check clearance is applied to personal and business checks in the U.S. It means this is also applicable for the payroll checks which are commonly used to give the monthly pay stubs for employees or are the fees received from the clients.

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Even if banks are only legally required to honor checks for a six-month period, it is usually a good idea to avoid any potential problems by depositing checks when you receive them. And if you fear that a check you have written has been lost or stolen, you should move promptly to cancel the check with your bank. Checks that remain outstanding for long periods of time can’t be cashed, as they become void. Outstanding checks that remain so for a long period of time are known as « stale » checks. Some checks become stale if dated after 60 or 90 days, while all become void after six months. As mentioned, personal checks are usually valid for up to six months after the date they were issued, but you shouldn’t count on the bank to pay attention to the dates.

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Eight months later, you realize that the vendor has still not cashed the check. It’s always best to contact the issuer before trying to cash a stale or outstanding check. Such a call may be awkward, but it’s better than imposing an overdraft fee on the person or business that wrote it. The length of time for a cashier’s check to go stale can also vary — from 60 days to never — depending on multiple factors.

Examples of Expiration of Checks by Type

The Huntington National Bank is an Equal Housing Lender and Member FDIC. ®, Huntington®,Huntington.Welcome.® and Huntington Heads Up® are federally registered service marks of Huntington Bancshares Incorporated. Though you want to avoid letting a check go out of date, there are some important considerations for a check that has become outdated.

Stale dated checks

If you receive a cashier’s check, look for a “void after X days” disclaimer and make sure you cash or deposit the check before then. If you discover an old cashier’s check, contact the issuing bank and ask them what they need from you to handle the transaction. Checks from the state or local government agencies will expire according to state law. So, how long a state tax refund check is good for will vary from state to state, but generally it’s 6 months to a year. If you have an expired state tax refund check, you should contact the state and request a new check. Just like with the federal checks, you’re still entitled to what the government owes you.

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

Tellers in banks will sometimes reject a check if the date is over that limit. This does not prevent a check from clearing the bank when deposited through other means than a teller. That said, it’s important to point out that stale dated checks are not the same as voided checks, which will have the word “VOID” written across the face. Instead, stale-dated checks are the same as unclaimed checks and dormant checks. If you find out that someone can’t cash the cheque you issued because it’s stale-dated, ask for the original cheque back before issuing a new one.

If you have a problem with a stale or expired check, it’s best to consult with a financial lawyer who can advise you on the best course of action. There may be legal remedies available to you as well as other steps an attorney can help you with to resolve the issue. Another solution is to contact the person or business that wrote you the check and ask them if they would issue another check to replace the stale one.

What is a Stale Check? – Definition, Explanation, And Features

While a stale-dated check is not inherently invalid, banks may refuse to honor it as an “irregular” bill of exchange. At this stage, the drawer — also known as the check writer or issuer — must modify the date on a replacement check or issue a new check-in order for the payment to be processed. The time it takes for a cashier’s check to go stale can likewise vary — from 60 days to never — based on a variety of factors.

  • That’s why we provide features like your Approval Odds and savings estimates.
  • Banks are still allowed to process an older check, if the institution believes the funds are good.
  • We advise all taxpayers to consult a professional tax advisor regarding their own specific needs.
  • Your payroll check will not become stale and remain valid during your state’s waiting period.
  • Let’s take a closer look into what a stale-dated cheque is and how they work.
  • You might have non-sufficient funds in your bank account or the signature might be incorrect.

Banks aren’t obligated to honour a cheque that’s older than six months, but they can. When it comes to organizing the finances for your business there can be a lot to know and understand. You want to have processes in place to pay bills, settle any debts and pay your employees. And sometimes you might need to write a cheque to or receive one from a vendor for payment.

The first step to implementing a practical company policy for stale-dated checks is to understand state laws. Read up on requirements both for your home state and for any other states your company does business in. Uncashed checks to vendors, Stale dated checks contractors, employee payroll, and distributions to stockholders are all potential unclaimed property. Certified checks are personal checks from a bank account owner who has drawn on the account and had the bank guarantee the check.

Furthermore, stale-dated check funds earn no interest or earnings and, if mishandled, can pose a risk to plan sponsors. Our experts have been helping you master your money for over four decades. We continually strive to provide consumers with the expert advice and tools needed to succeed throughout life’s financial journey. The offers that appear on this site are from companies that compensate us. But this compensation does not influence the information we publish, or the reviews that you see on this site.

The exception is Payroll checks which must be reported when they are one year old. Checks issued to California addresses may not be reported to the State of Washington but must be reported directly to the State of California. Checks reported with addresses to other States are passed on to those states by the State of Washington.

Features of Stale Check:

The six-month time frame generally applies to personal and business checks — including payroll checks. Apart from that, an employer who has received checks from the US treasury such as federal tax refund can be counted as stale-dated checks. These checks have a time limit of 12 months after they are issued by the government of America. In contrast to this, the check received from the state government is considered to be valid for 6 months.

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As a result, when the forgotten check resurfaces without warning, there may not be enough funds in the account to cover it. Make sure to review your bank statement to ensure no checks you’ve written go stale. If a check you wrote is approaching 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. An issued cheque is negotiable for six months plus one day from the date written on it, after which it becomes stale-dated. Stale-dated cheques have an increased chance of being returned by the issuing bank, and therefore financial institutions may not accept them.