How Long Is a Check Valid and What Happens When It Expires?
Understand check validity periods, expiration, and the practical implications for all parties involved. Gain essential financial insights.
Checks serve as a traditional payment method, facilitating transactions between individuals, businesses, and government entities. They represent an instruction from the drawer (the person writing the check) to their bank to pay a specified amount to the payee (the person receiving the check). Checks are time-sensitive financial instruments, meaning their validity is limited, and understanding these limitations is important for both those writing and receiving them.
Standard Validity Periods
Most personal and business checks typically remain valid for six months from their issue date. This timeframe is outlined in the Uniform Commercial Code (UCC), a collection of laws governing commercial transactions across the United States. Banks are generally not obligated to honor a check presented more than six months after its date.
A check presented after this six-month period is often referred to as “stale-dated.” While banks are not required to pay such checks, they retain the discretion to either honor or reject them. A bank might still process a stale-dated check, especially if the account has sufficient funds and there are no other red flags. However, relying on this discretion is not advisable, as a bank may refuse the transaction, potentially leading to inconveniences and fees.
Special Considerations for Different Check Types
The standard six-month validity period does not apply to all types of checks. U.S. Treasury checks, which include federal tax refunds, Social Security benefits, or veterans’ benefits, are typically valid for one year from their issue date. If these checks are not cashed within this period, the funds remain owed, and the recipient can contact the issuing federal agency to request a replacement.
Certified checks and cashier’s checks generally offer greater security and often have longer validity periods. These checks are guaranteed by the issuing bank, meaning the funds are set aside. Some may not have a specific expiration date, while others may become “stale” after 90 days to a year, or have a “void by” date printed on them. Even if stale-dated, the funds are usually still available from the issuing bank, though a replacement might be needed.
Money orders, another form of guaranteed payment, technically do not expire. However, holding onto a money order for an extended period, typically one to three years, can result in service fees being deducted from its value by the issuer. This means its redeemable amount can decrease over time. Post-dated checks, with a future date, become valid only on or after that date. Their validity period, typically three months, begins from this future date.
Implications of Expired Checks and What to Do
Expired checks create complications for both the payee and the drawer. For the payee, the primary implication is the inability to cash or deposit the check. If a stale-dated check is presented, the bank may reject it, and the payee could incur fees for a returned item. To avoid such issues, payees should deposit or cash checks promptly, ideally within a few days. If an old check is discovered, the payee should contact the drawer to request a new check.
For the drawer, an uncashed check remains an outstanding liability. While a bank is not obligated to honor a stale-dated check, it retains discretion to do so, meaning funds could be unexpectedly debited. To manage this, drawers should maintain accurate records of checks.
If a check remains uncashed, the drawer may consider placing a stop payment order on the original check, which typically remains in effect for six months. This service usually incurs a fee. The drawer can then re-issue a new check to the payee. Uncashed funds may also become subject to state unclaimed property laws, requiring funds to be turned over to the state after a dormancy period.