It is not unusual for individuals who change employers to lose track of their retirement accounts.

If they fail to transfer the account properly, and the account becomes dormant, after two years, the funds in the account are turned over to the state as unclaimed property. State laws vary a great deal on what happens next.

Anita Mukherjee and Corina Mommaerts, faculty members of the Center for Financial Security at the University of Wisconsin-Madison, have found that many of these accounts — which can run into the tens of thousands — remain unclaimed because most states are not allowed to link them to a Social Security number, and the states make no attempt to contact the account holders.

The accounts are listed as unclaimed property in the state in which they were established. And unless account owners do a state search of unclaimed property, their accounts will remain dormant for many years, perhaps forever.

Mukherjee and Mommaerts also point out that the state of Wisconsin is an exception. The state links accounts to a Social Security number, and thus can and does contact individuals whose accounts have become dormant.

Most employees with retirement accounts know that when they leave their jobs, it is their responsibility to take the proper steps and transfer their retirement accounts. Unfortunately, some fail to take that action, or they may not even know they have a retirement account. Some companies automatically sign their employees to a retirement account without their knowledge.

In other cases, individuals are simply too careless because the size of the account is small.

State databases are free to access. There is no reason for you not to search the unclaimed property database in your state to see whether there is any asset in your name.

Generally, all one has to do is search by personal name or business name to determine if there are any assets under their name. Go to, a free site managed by the National Association of Unclaimed Property Administrators, for a free search by state.

One may find that it is not difficult to have the funds transferred to them if they are the rightful owner of the asset. Several years ago, I used the site to recover thousands of dollars from a CD I was not aware of, left to me and my children by a deceased aunt.

According to Sarah Brenner of Ed Slott & Co., if one recovers funds from the state from a retirement account, they are allowed to roll over these funds into a retirement account with a procedure known as self-certification. (See her article “IRS Adds New Reason for Self-Certification of Late Rollovers,” at Revenue procedure 2020-47 covers this situation, and provides a sample letter for one to send to a trustee to allow the rollover. If one doesn’t do a rollover, one may be subject to income taxes and possibly an early withdrawal penalty if they are younger than 59 1/2.

If one does leave ajob, and have a retirement account, make sure they they take the proper steps to transfer the account to another financial institution.

If one allows the account to become dormant, oneu will lose the ability to have the account increase in value. Once the account becomes dormant, one no longer earns income on the account, and could also lose any potential capital gain, and they may be subject to tax penalties.

(Elliot Raphaelson welcomes his readers’ questions and comments on all things financial. Raphaelson can be contacted at

©2021 Elliot Raphaelson Distributed by Tribune Content Agency LLC

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