If you have forgotten about it and now wondering how long they last or do checks expire, you are in the right place. We will outline the validity period and type of the checks that are most common in the U.S.
Key Takeaways
- A check is a legal document that mandates a bank to pay a specific amount of money to a payee.
- Most checks are valid for six months or 180 days after they are issued.
- A traveler’s check is one of the rare types of checks that don’t have an expiration date.
- The peak usage of this payment method was in the 1990s. Currently, its use has declined because of electronic payment options.
- If the check has expired, contact the drawer and request a new one, this is a common financial practice.
When Do Checks Expire?
The validity period depends on the type of check. Generally, most checks, including personal, payroll, and business ones, are valid for six months or 180 days.
Some businesses have ‘void after 90 days’ printed on them, but this is to encourage payees to cash in the check, and these checks will still be valid for 180 days.
The U.S. Treasury checks, like tax refund checks, are valid for a year from the issued date.
State or local government checks are valid for 6 to 12 months, depending on the state.
Traveler’s checks, on the other hand, do not expire.
What Is a Check?
A check is a legal document that mandates a bank to pay a specific amount of money to a payee. The money is withdrawn from the drawer’s transaction bank account, where the money is held.
The drawer is the person or a financial institution, and they are the payer in this scenario. The drawer is the bank or credit union that transfers the drawer’s money from the respective transactional bank account to the payee.
A payee is a person or legal entity that receives the payment via check.
On the check is included information about the monetary amount, date, the payee, and the drawer’s signature.
Different forms of checks have existed since the 9th century. The peak usage was recorded in the 1990s. Since then, its use has declined because of convenient electronic payment methods.
Types of Checks Used In The USA
Bearer Check
A bearer check allows anyone who is carrying it to receive the payment specified on the check. This means either the payee or the bearer can accept the payment specified.
Bearer checks are transferable. The bank doesn’t need the drawer’s authorization to make the payment to the bearer.
Order Check
An order check is a type of check where the term “or bearer” is crossed off. It means only the payee whose name is on it can receive payment from the bank. The bank, as an entity, will verify the identity of the bearer to make the payment.
Crossed Check
This is where the issuer makes two slightly bent, parallel lines on the top left corner of the cheque with the word ‘a/c payee.’ This means that regardless of who’s bearing the check, the payment specified can only be made to the person or legal entity mentioned as the payee on the check.
A payee can only cash a crossed check in their bank!
Open Check
These are also called uncrossed checks. The issuer of the check has to sign both the front and the back of it. The payee can cash it at either the payer’s or payee’s bank.
Additionally, open checks are transferable, meaning the payee can be changed.
Post Dated Check
Post-dated checks mention a date after it has been signed. The payee can only cash the check after this mentioned date.
If the payee presents the check to the bank before the mentioned date, the bank will only process the check after the mentioned date.
Traveler’s Check
The payee can cash a traveler’s check at a different bank in a foreign country. The payee will receive the money in the relevant country’s currency.
These types of checks are perfect for international travelers who don’t want to carry too much cash with them, and the good thing is that they don’t have an expiry date.
Self Check
A self-check is where the check mentions’ self’ in the payee information section. Drawers use self-checks to withdraw money from the bank.
Banker’s Check
The bank issues a banker’s check on behalf of the account holder. Banks can use this to pay a payee in the same city as the bank. These are only valid for three months, but the payee can extend the validity period if certain conditions are fulfilled.
Handling an Uncashed Check that You Issued
Checks that are issued go uncashed are called outstanding checks.
Checks can do expire for several reasons:
- The payee could not be in a rush to cash it.
- The payee might forget to cash it.
- The check may get lost in mailing, or it might just be still being processed by the bank.
These types of checks can cause some problems for a business or an individual!
The bank account of the drawer might show an inflated balance; the business might be infringing on unclaimed property laws or cause problems when it comes to business accounting.
You can take control of outstanding checks by communicating with the payee. You can encourage them to cash it or provide them with a new one if the first has expired.
If a check is lost, you can contact the bank and stop cashing the possibility for it. This process, however, requires you to pay a fee each time.
If you cannot contact the payee, request the bank to stop the payment, and put the funds mentioned in the check into a savings account.
This way, you can pay the payee if you eventually manage to contact them. Plus, you will have managed to avoid a business or personal accounting problem.
What to Do if You Forgot to Cash a Check
Firstly, found out the validity period of the check. If it is still valid, waste no time and cash it immediately.
You can contact the drawer and request a new check if the check has expired. They might request that you send the original copy of it back for safety reasons, and once the drawer receives this original check, they can issue a new one for you.
Summary
We have summarized how long they last and do checks expire, so now is everything clear. Electronic payment methods have become the first option in the finance market, but that doesn’t mean that this type of document can’t come in handy in certain situations.