Delaware Just Mailed Its April 10 VDA Invitations. Here's Why That Envelope Could Be the Most Important Piece of Mail Your Company Gets This Year.

A plain-English guide to what the invitation means, what's really at stake, and the five things to do before your 90-day window closes.

Delaware's Secretary of State released its latest wave of Voluntary Disclosure Agreement invitations on April 10. Recipients have 90 days to respond.

Every spring and fall, a batch of unassuming letters leaves Delaware and lands in corporate mailrooms across the country. They don't look urgent. They aren't certified. And in a lot of organizations, they get routed to a shared inbox, a registered-agent portal, or a desk drawer — and quietly forgotten.

On April 10, Delaware's Secretary of State sent its newest round of Unclaimed Property Voluntary Disclosure Agreement (VDA) invitations. If one of those letters has your company's name on it, a clock has already started — and what you do in the next 90 days will determine whether you resolve this on your terms or on the state's.

This post explains, in practical language, what the letter is, why Delaware sent it to you, and exactly how to respond.

First, the Good News: This Is an Invitation, Not an Accusation

A VDA invitation is not an audit notice, a demand letter, or a finding that your company did something wrong. It's closer to an off-ramp. Delaware is telling you that your organization is on its radar for unclaimed property compliance and — before it sends the file to its enforcement side — it's giving you one chance to come in voluntarily, clean up any historical exposure, and walk away without interest or penalties.

That off-ramp, however, has a gate that closes. You have 90 days from the date on the letter to submit Form VDA-1 and enroll. Miss the window and the matter is referred to the Department of Finance's Office of Unclaimed Property, which handles examinations. At that point, the friendly version of this conversation is over.

"We've Never Even Heard of Unclaimed Property — Why Us?"

We hear this constantly, and it's a fair reaction. Most finance and legal teams associate "unclaimed property" with forgotten bank accounts and old utility deposits — consumer stuff. But escheat law reaches deep into ordinary corporate operations. The most common sources of exposure we see have nothing exotic about them:

·  Outstanding vendor checks that were cut, never cashed, and eventually voided or written off.

·  Payroll items — a final paycheck, an expense reimbursement, a bonus — that an ex-employee never deposited.

·  Customer credit balances sitting in accounts receivable from over-payments, duplicate payments, or unapplied cash.

·  Gift card and stored-value breakage for retailers, hospitality groups, and platforms.

·  Unresolved rebates, refunds, royalties, and class-action distributions that never made it to the payee.

Delaware cares because of a jurisdictional rule most companies have never thought about: when the rightful owner of property can't be identified or located, the obligation "defaults" to the holder's state of incorporation. More U.S. businesses are incorporated in Delaware than anywhere else — which makes Delaware, by a wide margin, the most active unclaimed property jurisdiction in the country. Being chartered there is often all it takes to land on the mailing list.

What Actually Happens If You Let the 90 Days Lapse

This is where the economics get lopsided. An unclaimed property examination in Delaware is not a desk review — it's a multi-year forensic exercise, typically run by outside audit firms working under contract with the state. Companies that have been through one describe the same pain points:

·  A look-back that feels endless. Auditors commonly request transaction-level data going back roughly 15 years (a 10-year reach-back plus the dormancy period). Most ERP systems, and most employees, weren't around for the early part of that window.

·  The burden of proof flips. Every aged check, void, and credit is presumed to be escheatable unless you can document otherwise — item by item.

·  Gaps get estimated. Where records don't exist, Delaware is permitted to extrapolate a liability using statistical sampling. For companies with incomplete archives, the estimated figure is frequently larger than anything they actually owe.

·  Interest stacks up. Statutory interest can run as high as 50% of the assessed amount, with additional civil penalties layered on for late reporting or payment.

·  It drags. Two to five years is a normal timeline. That's two to five years of document pulls, interviews, and outside-counsel invoices.

Compare that to the VDA track: you (or your advisor) run the review, you set the pace within the program's milestones, interest and penalties are waived, and the periods you resolve are closed.

The same starting point, two very different outcomes. Enrolling keeps control — and cost — on your side of the table.

Your First-30-Days Checklist

The 90-day deadline is for enrollment — not for finishing the entire review. You don't need to know your exposure on day one. You just need to get in the door and get organized. Here's the sequence we walk clients through in the first month:

1.       Locate every copy of the letter. VDA invitations are often addressed to a registered agent or a legacy officer. Confirm the postmark date, the named entities (parents and subsidiaries are frequently listed separately), and who internally has seen it.

2.       Decide who owns the response. This usually sits at the intersection of tax, treasury/AP, legal, and the controller's group. Name one accountable owner now — not in week eleven.

3.       Run a quick heat-map of exposure. Pull aged outstanding check registers, AR credit-balance reports, unredeemed gift card data, and any "suspense" or "miscellaneous liability" accounts. You're not quantifying yet — you're finding where the bodies might be.

4.       Preserve records. Issue a lightweight hold on purging AP, payroll, and AR detail for the look-back years. In a VDA, documentation is your best friend; every item you can substantiate is an item that doesn't get estimated.

5.       File Form VDA-1 before day 90. Enrollment is short and does not commit you to a number. It simply moves you onto the voluntary track and stops the referral to audit.

Three Myths Worth Retiring

·         "We're too small to be worth auditing." Delaware's targeting isn't purely size-based. Incorporation, industry, M&A history, and a thin (or missing) filing record all factor in. Mid-market and PE-backed companies are squarely in scope.

·         "We wrote those checks off — they're gone." Accounting treatment doesn't extinguish the owner's claim or the state's. A voided check that was legitimately owed is still unclaimed property.

·         "If we enroll, we're admitting we owe something." Enrollment is procedural. Plenty of companies complete a VDA, demonstrate minimal or zero liability, and close it out. What you can't do is make that showing if you've already been referred to audit.

How Advisely Helps

Unclaimed property sits in an odd corner of corporate compliance — it isn't quite tax, isn't quite treasury, and isn't quite legal, so it often belongs to no one until a letter forces the issue. That's the gap we fill.

Advisely works alongside finance and legal teams to triage the invitation, size the realistic exposure before you commit to a position, prepare and submit the VDA enrollment, run the self-review in a defensible and well-documented way, and negotiate the final resolution with the state. And once the VDA is closed, we help stand up the policies and annual reporting cadence that keep your company off the next mailing list.

If a Delaware VDA invitation dated April 10 is sitting in your mailroom — or you're not sure whether one arrived — reach out. A 20-minute call now is a lot cheaper than a five-year audit later.

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This article is provided by Advisely LLC for general informational purposes only and does not constitute legal, tax, or accounting advice. Unclaimed property rules vary by jurisdiction and change frequently; readers should consult a qualified advisor regarding their specific circumstances.