Escheat

AAA

DEFINITION of 'Escheat'

The transfer of title of property or an estate to the state when an individual dies without a will and legal heirs. Escheat ensures that property always has a recognized owner, which would be the state or government if no other claimants to ownership exist. Most jurisdictions have their own laws and regulations defining escheat and the circumstances under which it can be invoked. Escheat is usually done on a revocable basis, which means that ownership of the estate or property would revert to a rightful heir should one turn up.

INVESTOPEDIA EXPLAINS 'Escheat'

In some jurisdictions, escheat also refers to the title transfer of financial assets such as bank deposits and unclaimed securities in accounts that have been dormant for a very long period of time to a state authority. Institutions with such dormant accounts are required to make efforts - such as sending reminders and issuing notices in publications - to locate the owners of these assets before transferring title to the state under escheat. Some jurisdictions maintain online registries of dormant assets such as bank deposits, which enables their rightful owners to reclaim them since escheat is revocable in most cases.

RELATED TERMS
  1. Estate

    All of the valuable things an individual owns, such as real estate, ...
  2. Estate Planning

    The collection of preparation tasks that serve to manage an individual's ...
  3. Will

    A legally enforceable declaration of how a person wishes his ...
  4. Heir

    HeirA person who inherits some or all of the estate of another ...
  5. Beneficiary

    Anybody who gains an advantage and/or profits from something. ...
  6. Inheritance

    All or part of a person's estate/assets that is given to an heir ...
Related Articles
  1. Getting Started On Your Estate Plan
    Options & Futures

    Getting Started On Your Estate Plan

  2. Three Documents You Shouldn't Do Without ...
    Options & Futures

    Three Documents You Shouldn't Do Without ...

  3. An Estate Planning Must: Update Your ...
    Options & Futures

    An Estate Planning Must: Update Your ...

  4. Skipping-Out on Probate Costs
    Retirement

    Skipping-Out on Probate Costs

comments powered by Disqus
Hot Definitions
  1. Ghosting

    An illegal practice whereby two or more market makers collectively attempt to influence and change the price of a stock. ...
  2. Elasticity

    A measure of a variable's sensitivity to a change in another variable. In economics, elasticity refers the degree to which ...
  3. Tangible Common Equity - TCE

    A measure of a company's capital, which is used to evaluate a financial institution's ability to deal with potential losses. ...
  4. Yield To Maturity (YTM)

    The rate of return anticipated on a bond if held until the maturity date. YTM is considered a long-term bond yield expressed ...
  5. Net Present Value Of Growth Opportunities - NPVGO

    A calculation of the net present value of all future cash flows involved with an additional acquisition, or potential acquisition. ...
  6. Gresham's Law

    A monetary principle stating that "bad money drives out good." In currency valuation, Gresham's Law states that if a new ...
Trading Center