Drycleaning Insurance: How to Deal with Property Abandonment

If you own a drycleaning business, chances are that at one time or another, you’ve had clothing or other types of fabrics left at your business, with the customer never returning. Perhaps you have abandoned property in your possession right now. Drycleaner owners have seen everything from upholstered furniture, fur coats, and day-to-day clothes like dress shirts and suits get left behind.

In some states, such as New York and New Jersey, the laws state that dry cleaners are responsible for unclaimed items for up to six months. During this time, it’s recommended that they repeatedly contact the customer. However, if the customer doesn’t respond after that time, the items are deemed abandoned property.

So what should you do? First off, if you feel that property has been abandoned at your business, review your state’s abandoned property laws to ensure you follow proper procedures. Even with an appropriate Drycleaning Insurance policy in place, you want to try to avoid a lawsuit from a disgruntled customer that may come back weeks later to claim their items.

The next logical step that many drycleaning professionals would take is to donate the items. It’s important to note that selling the items is not an option. In fact, one New York cleaner ran into legal trouble for trying to sell clothes that had been left for more than six months, according to the National Cleaners Association director of special events Ann Hargrove. Donating comes with risks as well however.

One New York accountant points out that “A business charitable tax deduction has to have a tax basis.” This means that because the abandoned clothes cost the drycleaning business nothing, the business’s charitable donation would then be nothing. In some states, not only can the drycleaning business not write off the donation, they also must keep the donation receipt for years afterwards in case the customer or customer’s family comes back.

It’s important to always assess your Drycleaning Insurance risks when making any business decisions. In order to best protect your Drycleaning business from exposures, it’s imperative to have the appropriate Drycleaning Insurance Policy in place. At Irving Weber Associates, Inc. (IWA), we offer laundry insurance programs such as the FabriCare Advantage  program. Please contact us today to learn more at (855) 764-7406.