Outstanding gift certificates?

So, here's the deal - after 2 years, I am supposed to turn over all unused GC money to the state. I get to keep 40% of the face value, but if the guest shows up with the GC I have to file a claim to get the money back. (The rules changed about 5 years ago and I don't have to turn the money in after that point because we sell less than $250k in GC's each year.)
I just went thru the GC pile and there are quite a few outstanding going back about 10 years.
Here's the question - would you:

• Contact the recipient to remind them they have this opportunity out there that they are missing?
• Just turn the money in and hope the guest never shows up?
• Other?

I'm talking about $2k in outstanding GC's that are old enough to be a concern. Newer ones are being used in the same year.
The problem comes in when I do not know who got the GC, only the person who bought it. Telling someone their $500 gift went unused is kind of sad. But maybe the person misplaced it and is kicking herself not knowing it's ok to just call.

Sorry, even though I live in the same state, no one but me and Poppa are ever going to know what GCs are still sitting in my office drawer.

Really? Who from your state knows how many GC you sold? Do you have to specify on your taxes? If they haven't used a GC in 10 years I would say forget about them. I sure would.

EmptyNest said:

Really? Who from your state knows how many GC you sold? Do you have to specify on your taxes? If they haven't used a GC in 10 years I would say forget about them. I sure would..

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Yup. We've forgotten about them... snooze and lose.

Doesn't this apply for your state? For gift cards that are sold on or after December 31, 2011, the unclaimed value of the cards after the two year dormancy period will only be treated as escheatable if the business sells at least $250,000 in face value of gift obligations during the previous calendar year.
Money grab! You've paid taxes on this already and it's not like you've got the money from those sales sitting in a bank account.

Ok, how about this - when we sell we'll be giving the $2k to the new owners. I'd rather have the guests enjoy their GC while we're still here.
I'm getting the impression no one thinks I should contact the GC buyers to remind them. It feels like stealing to me! I could see if I had no idea who bought them, but i do have the addresses where I mailed them.

seashanty said:

Doesn't this apply for your state? For gift cards that are sold on or after December 31, 2011, the unclaimed value of the cards after the two year dormancy period will only be treated as escheatable if the business sells at least $250,000 in face value of gift obligations during the previous calendar year.
Money grab! You've paid taxes on this already and it's not like you've got the money from those sales sitting in a bank account..

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Yes, I mentioned the regulations changed.
No, I haven't paid taxes on the money. We pay the tax when they are redeemed.

Morticia said:

Ok, how about this - when we sell we'll be giving the $2k to the new owners. I'd rather have the guests enjoy their GC while we're still here.
I'm getting the impression no one thinks I should contact the GC buyers to remind them. It feels like stealing to me! I could see if I had no idea who bought them, but i do have the addresses where I mailed them..

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I have several GC I never used...it's been years...no one has contacted me. I wouldn't worry about it in the least. Someone bought them, no one used them...no big deal. Not your fault!

Morticia said:

seashanty said:

Doesn't this apply for your state? For gift cards that are sold on or after December 31, 2011, the unclaimed value of the cards after the two year dormancy period will only be treated as escheatable if the business sells at least $250,000 in face value of gift obligations during the previous calendar year.
Money grab! You've paid taxes on this already and it's not like you've got the money from those sales sitting in a bank account..

Click to expand...

Yes, I mentioned the regulations changed.
No, I haven't paid taxes on the money. We pay the tax when they are redeemed.
.

Click to expand...

We declare all Gifts Sold as income and pay the IRS accordingly every year. We do not pay the State Lodging Tax until it has been redeemed which only makes sense.
We inherited the PO's past outstanding GCs, so it will likely be a wash when we go to sell. And no, the money is not just sitting in a separate bank account, we use it like any other income.

Momma Smurf said:

Sorry, even though I live in the same state, no one but me and Poppa are ever going to know what GCs are still sitting in my office drawer..

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That is exactly my answer, I was just standing back peering around the corner to see what the action was going to be. Last year I got an e-mail asking if the GC she bought for her parents but was never used (found when clearing the house after both had died) was still good. I told her yes, but we no longer did the dinners. She came, she enjoyed. There is no way, no how that I am giving the State any money that I may have to petition THEM to return. That is a gaping maw - and one way at that. I know what is and am the only one that needs to know.

My two cents... I have one GC that hasn't been used. I hate that it hasn't been used. I hate that it's a receivable on my business. I offered to convert it to a B&B.COM gift certificate for them so they can use it wherever they want to use it, but I'm very close to just sending them a cheque for it. I would rather have it off my books than keep it.
But then again... I still hold a grudge against folks who stole my Christmas tissue boxes. So my moral code is questionable as is.

Momma Smurf said:

Morticia said:

seashanty said:

Doesn't this apply for your state? For gift cards that are sold on or after December 31, 2011, the unclaimed value of the cards after the two year dormancy period will only be treated as escheatable if the business sells at least $250,000 in face value of gift obligations during the previous calendar year.
Money grab! You've paid taxes on this already and it's not like you've got the money from those sales sitting in a bank account..

Click to expand...

Yes, I mentioned the regulations changed.
No, I haven't paid taxes on the money. We pay the tax when they are redeemed.
.

Click to expand...

We declare all Gifts Sold as income and pay the IRS accordingly every year. We do not pay the State Lodging Tax until it has been redeemed which only makes sense.
We inherited the PO's past outstanding GCs, so it will likely be a wash when we go to sell. And no, the money is not just sitting in a separate bank account, we use it like any other income.
.

Click to expand...

Momma Smurf said:

We declare all Gifts Sold as income and pay the IRS accordingly every year. We do not pay the State Lodging Tax until it has been redeemed which only makes sense.

Click to expand...

This is how we do it also.
When we bought our place, we got credit for the gift certificates, but not the donation certificates. I had to contact the previous owner when one was used so they would pay me. I'll never do that again.

Given the hatred your governor has for government, and his desire to fire everyone in the state, I wouldn't worry about anyone from enforcement ever showing up at your door.

Breakfast Diva said:

Momma Smurf said:

Morticia said:

seashanty said:

Doesn't this apply for your state? For gift cards that are sold on or after December 31, 2011, the unclaimed value of the cards after the two year dormancy period will only be treated as escheatable if the business sells at least $250,000 in face value of gift obligations during the previous calendar year.
Money grab! You've paid taxes on this already and it's not like you've got the money from those sales sitting in a bank account..

Click to expand...

Yes, I mentioned the regulations changed.
No, I haven't paid taxes on the money. We pay the tax when they are redeemed.
.

Click to expand...

We declare all Gifts Sold as income and pay the IRS accordingly every year. We do not pay the State Lodging Tax until it has been redeemed which only makes sense.
We inherited the PO's past outstanding GCs, so it will likely be a wash when we go to sell. And no, the money is not just sitting in a separate bank account, we use it like any other income.
.

Click to expand...

Momma Smurf said:

We declare all Gifts Sold as income and pay the IRS accordingly every year. We do not pay the State Lodging Tax until it has been redeemed which only makes sense.

Click to expand...

This is how we do it also.
When we bought our place, we got credit for the gift certificates, but not the donation certificates. I had to contact the previous owner when one was used so they would pay me. I'll never do that again.
.

Click to expand...

Breakfast Diva said:

When we bought our place, we got credit for the gift certificates, but not the donation certificates. I had to contact the previous owner when one was used so they would pay me. I'll never do that again.

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We did not get all the money from purchased GC's when we bought. We were still calling the PO's 2 years down the road. They insisted they had given us all the money but the GC's kept showing up. (And all of a sudden a database materialized that they insisted didn't exist when we asked for all guest records.)
Then, due to the way they sold the GC's (online, print it out yourself) we kept getting calls about GC's that were printed out but never paid for. What a pain. We had the guests fax us a copy of what they had and none of them were validated.
The PO's had a couple of outstanding donations they had made that we had to eat. We called about those and they laughed at us. Pretty much said we could turn the guests away and deal with the bad publicity ourselves but they weren't paying for those. We were annoyed they were still handing them out days before the closing. I've stopped the donated GC's. Most of them were never used.

PhineasSwann said:

Given the hatred your governor has for government, and his desire to fire everyone in the state, I wouldn't worry about anyone from enforcement ever showing up at your door..

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PhineasSwann said:

Given the hatred your governor has for government, and his desire to fire everyone in the state, I wouldn't worry about anyone from enforcement ever showing up at your door.

Click to expand...

;-)
Ya gotta wonder why he wants to go to DC given how much he hates government.

Generic said:

My two cents... I have one GC that hasn't been used. I hate that it hasn't been used. I hate that it's a receivable on my business. I offered to convert it to a B&B.COM gift certificate for them so they can use it wherever they want to use it, but I'm very close to just sending them a cheque for it. I would rather have it off my books than keep it.
But then again... I still hold a grudge against folks who stole my Christmas tissue boxes. So my moral code is questionable as is..

Click to expand...

Generic said:

My two cents... I have one GC that hasn't been used. I hate that it hasn't been used. I hate that it's a receivable on my business. I offered to convert it to a B&B.COM gift certificate for them so they can use it wherever they want to use it, but I'm very close to just sending them a cheque for it. I would rather have it off my books than keep it.
But then again... I still hold a grudge against folks who stole my Christmas tissue boxes. So my moral code is questionable as is.

Click to expand...

I also wonder if I contacted the buyers if that's what they would want - a refund. We've done that a couple of times. Buyer's remorse.

Morticia said:

Generic said:

My two cents... I have one GC that hasn't been used. I hate that it hasn't been used. I hate that it's a receivable on my business. I offered to convert it to a B&B.COM gift certificate for them so they can use it wherever they want to use it, but I'm very close to just sending them a cheque for it. I would rather have it off my books than keep it.
But then again... I still hold a grudge against folks who stole my Christmas tissue boxes. So my moral code is questionable as is..

Click to expand...

Generic said:

My two cents... I have one GC that hasn't been used. I hate that it hasn't been used. I hate that it's a receivable on my business. I offered to convert it to a B&B.COM gift certificate for them so they can use it wherever they want to use it, but I'm very close to just sending them a cheque for it. I would rather have it off my books than keep it.
But then again... I still hold a grudge against folks who stole my Christmas tissue boxes. So my moral code is questionable as is.

Click to expand...

I also wonder if I contacted the buyers if that's what they would want - a refund. We've done that a couple of times. Buyer's remorse.
.

Click to expand...

You don't owe it to anyone to call about a gift certificate. especially if it has been years. Put the money in your bank account and move on .

EmptyNest said:

Morticia said:

Generic said:

My two cents... I have one GC that hasn't been used. I hate that it hasn't been used. I hate that it's a receivable on my business. I offered to convert it to a B&B.COM gift certificate for them so they can use it wherever they want to use it, but I'm very close to just sending them a cheque for it. I would rather have it off my books than keep it.
But then again... I still hold a grudge against folks who stole my Christmas tissue boxes. So my moral code is questionable as is..

Click to expand...

Generic said:

My two cents... I have one GC that hasn't been used. I hate that it hasn't been used. I hate that it's a receivable on my business. I offered to convert it to a B&B.COM gift certificate for them so they can use it wherever they want to use it, but I'm very close to just sending them a cheque for it. I would rather have it off my books than keep it.
But then again... I still hold a grudge against folks who stole my Christmas tissue boxes. So my moral code is questionable as is.

Click to expand...

I also wonder if I contacted the buyers if that's what they would want - a refund. We've done that a couple of times. Buyer's remorse.
.

Click to expand...

You don't owe it to anyone to call about a gift certificate. especially if it has been years. Put the money in your bank account and move on .
.

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Owe it, no. Put into your bank account? Not if you are legally running your business. It's not yours, it's an A/R and stays there until the day you close.