Is it legal for gift certificates to expire?

The federal Credit Card Accountability Responsibility and Disclosure (CARD) Act of 2009, and some state laws, regulate gift certificates and cards.

Question

I bought my mother a $75 gift certificate at a store about a year ago, but just discovered she never used it. There's a six-month expiration date. Is there any way she can still redeem this?

Answer

An astounding number of expired gift certificates or gift cards are probably lying around in the desk drawers of self-denying moms. But common though this problem must be, only some states have laws that deal with it. Luckily, federal law addresses this issue.

Federal Gift Card Law

Thanks to the federal Credit CARD Act of 2009, gift certificates and store gift cards can't expire for five years. However, issuers can still charge an "inactivity fee" if the card has not been used within twelve months. (15 U.S.C. § 1693l–1).

State Laws

Again, some states have passed laws that regulate gift certificates and gift cards. In California, for example, it's against the law for store gift certificates and gift cards to have an expiration date or dormancy fees (except under certain circumstances), and if the balance on the card is less than $10, you can redeem it for cash. (Cal. Civil Code § 1749.5).

To find out if your state has any laws that cover gift cards or certificates, check out the National Conference of State Legislature’s chart covering state statutes related to gift certificates and gift cards. A local consumer protection lawyer can also tell you about applicable laws in your state.

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