Written by: Sarah Stojkovic – Manager, Unclaimed Property
In recent years, Delaware has continued to expand its enforcement of unclaimed property requirements. Businesses incorporated in Delaware are beginning to see increased audit activity that includes penalties, interest, and a more assertive compliance posture from the state.
The Delaware Voluntary Disclosure Agreement (VDA) program remains one of the most effective paths for companies seeking to proactively manage their unclaimed property exposure, but many organizations are still unsure of how it applies to them or why they should take action now.
Penalties and Interest Are Now Material
Companies settling Delaware audits from 2025 are seeing the state apply meaningful financial consequences. Interest is assessed at 0.5% per month, up to a maximum of 50%. Civil penalties for late reporting can accrue at 5 percent per month up to 50% or a maximum of $5,000 per report. In addition, failure to pay can result in a separate penalty of 0.5% per month up to 25%.
These amounts create significant exposure for companies that have not evaluated their historical compliance. What may have been a routine remediation effort through the VDA program can escalate into a costly settlement when interest and penalties are included. Delaware is applying these amounts consistently, and businesses incorporated in the state with long reporting histories or legacy integration issues are particularly at risk.
VDA Invitations Are Being Issued More Frequently
Delaware has also increased the frequency of its VDA invitations. While the program has always served as the state’s preferred method for encouraging compliance, invitations are now being issued more often than twice per year. When a business receives one, it signals that the state has already identified the company as a candidate for review. If the company does not accept the invitation, the next step is typically an audit.
Responding promptly allows a business to enter the VDA process voluntarily. This avoids penalties and interest, minimizes business disruption, and provides a more manageable and controllable framework for completing a historical review.
The VDA Review Remains a Holder-Directed Process
One of the key benefits of the Delaware VDA program is that it is conducted by the holder rather than by a third-party audit firm. Companies retain more control over the strategy, analysis, and presentation of the review in a structured and efficient manner. This is very different from traditional Delaware audits, which often involve third parties that take a broader and more time-consuming approach.
Why Acting Now Matters
Companies that do not respond to a VDA invitation and wait for the state to contact them often find themselves with fewer options and greater risk. A proactive review through the VDA program can significantly reduce financial exposure, improve compliance practices, and create a far more predictable process for resolving historical liabilities.
At DMA, we have extensive experience guiding companies through Delaware VDAs and unclaimed property reviews. Our team understands the state’s expectations, common pitfalls, and the nuances that determine whether a review proceeds smoothly. If you have received a Delaware VDA invitation or believe one may be coming, we can help you respond effectively and protect your business from unnecessary audit and penalty exposure.
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