Stale Check

What is a stale check?

A stale check is a check that has not been cashed within a specified period, typically six months. Banks may refuse to honor stale checks, though they are not legally required to. Stale checks create reconciliation problems because the cash remains in your account but the liability or expense was already recorded. Eventually, you must decide whether to void the check or reissue it.

Handling stale checks in your books

Review outstanding checks monthly during bank reconciliation. Contact payees of checks outstanding more than 60 days to confirm receipt. For checks outstanding more than six months, consider voiding and reissuing if the payee still needs payment, or reversing the entry if the obligation no longer exists. Do not simply ignore stale checks as reconciling items.

Unclaimed property considerations

Many states require reporting unclaimed checks to the state after a dormancy period, often three to five years. This includes uncashed payroll checks, vendor payments, and customer refunds. Escheatment rules vary by state. Before voiding old checks, understand your unclaimed property obligations. The obligation to the payee does not simply disappear.