Under federal law, gift card expiration laws set a five-year floor: a store gift card, gift certificate, or general-use prepaid card cannot expire sooner than five years from the date it was issued or last reloaded. That rule comes from the Credit CARD Act of 2009, codified at 15 U.S.C. § 1693l–1.1Office of the Law Revision Counsel. 15 USC 1693l-1 – General-Use Prepaid Cards, Gift Certificates, and Store Gift Cards Many states go further, and in about a dozen of them gift card balances never expire at all.
The Five-Year Federal Floor
It is illegal to sell or issue a gift certificate, store gift card, or general-use prepaid card with an expiration date earlier than five years from the date of issuance or the most recent date funds were loaded onto it.1Office of the Law Revision Counsel. 15 USC 1693l-1 – General-Use Prepaid Cards, Gift Certificates, and Store Gift Cards If a card carries an expiration date at all, it must be stated clearly and conspicuously on the card itself.
The rule covers essentially every gift card you would buy: single-store cards, cards good at a group of affiliated brands, and Visa- or Mastercard-branded cards usable anywhere the network is accepted. Digital and e-gift cards count too. The statute defines “gift certificate” and “store gift card” to include an “electronic promise,” so a code emailed after an online purchase gets the same protection as a plastic card.2Office of the Law Revision Counsel. 15 USC 1693l-1 – General-Use Prepaid Cards, Gift Certificates, and Store Gift Cards
One category sits outside these protections. Loyalty, award, and promotional cards given to you without any money changing hands are excluded, and they can expire on a shorter timeline.1Office of the Law Revision Counsel. 15 USC 1693l-1 – General-Use Prepaid Cards, Gift Certificates, and Store Gift Cards If you received a card as a rebate or store reward rather than buying it, check the fine print.
The Card Can Expire Before the Money Does
This trips people up. The plastic card has a printed expiration date, like a debit card. The money on it can outlast the plastic. Federal regulations treat those as two different things. If the physical card expires while funds remain, the issuer must tell you the funds are still available and give you a toll-free number or website to request a replacement card.3eCFR. 12 CFR 1005.20 – Requirements for Gift Cards and Gift Certificates
The issuer cannot charge you for the replacement unless the original was lost or stolen.3eCFR. 12 CFR 1005.20 – Requirements for Gift Cards and Gift Certificates So if you find an old gift card in a drawer and the plastic date has passed, call the number on the back before you assume the balance is gone. In most cases the money is still there and the issuer owes you access to it at no cost.
Fees That Quietly Drain a Balance
A card that technically never expires can still lose value through fees. Dormancy or inactivity fees are the most common. Federal law limits them in three specific ways:
- No dormancy, inactivity, or service fee can be charged unless the card has had no activity for at least 12 months.1Office of the Law Revision Counsel. 15 USC 1693l-1 – General-Use Prepaid Cards, Gift Certificates, and Store Gift Cards
- After that window opens, the issuer can charge no more than one such fee in any given month.1Office of the Law Revision Counsel. 15 USC 1693l-1 – General-Use Prepaid Cards, Gift Certificates, and Store Gift Cards
- The card must state on its face that a fee may be charged, the amount, how often it applies, and that inactivity triggers it. The issuer also has to disclose the fee to the buyer before the sale, whether the purchase happens in person, online, or by phone.4GovInfo. 15 USC 1693l-1 – General-Use Prepaid Cards, Gift Certificates, and Store Gift Cards
Other charges, such as purchase or activation fees, are not banned outright, but they too must be disclosed with the card, including the type of fee, the amount or formula, and the conditions that trigger it.3eCFR. 12 CFR 1005.20 – Requirements for Gift Cards and Gift Certificates The card must also carry a toll-free number and website where fee information can be obtained. If you were never told about a fee before buying the card, the issuer likely broke the law.
State Laws Often Go Further
Federal law is a floor. States can give consumers more, and many do. Roughly a dozen states, including California, Connecticut, Illinois, Maine, Minnesota, Montana, and Rhode Island, ban gift card expiration dates outright, so the balance never expires no matter how long the card sits unused. Several of these states also prohibit dormancy and inactivity fees entirely. Where a state rule protects the consumer more than the federal one, the state rule controls.
Cash Back for Small Balances
About ten states require retailers to redeem small remaining balances in cash when a customer asks. Thresholds vary, commonly from less than one dollar to less than ten. California raised its threshold effective April 1, 2026: retailers must now cash out any gift card with a remaining balance under fifteen dollars.5LegiScan. Bill Text: CA SB22 2025-2026 Regular Session Chaptered Most states have no cash-back law at all, so whether you can walk out with the last $2.37 in change depends entirely on where you are. Cashiers rarely volunteer this, so it helps to know your state’s rule before you ask.
What Happens to Balances You Never Use
Unused balances do not simply vanish. Every state has an unclaimed property law, sometimes called escheatment, that requires businesses to turn over dormant accounts to the state treasury after a set period. Gift cards fall under these rules. Dormancy periods commonly run three to five years, after which the retailer reports and remits the balance to the state.
The money then sits in the state’s unclaimed property fund. You can usually search your state treasurer’s website and file a claim to recover it. So even when a card stops working at the register, the underlying value has not disappeared. It has just moved. This runs on its own track, separate from the card’s expiration rules, and it can catch cards that supposedly never expire.
Bankruptcy Is the Real Limit
The federal and state protections do not do much when the company that issued the card goes out of business. A retailer in Chapter 11 must ask the bankruptcy court for permission to keep honoring gift cards. Some do, to keep customers coming through the doors during reorganization. Others do not, and when that happens the cards become essentially worthless unless the holder files a formal claim as a creditor against the estate.6Federal Reserve Bank of Boston. Gift Card Value When Issuers Go Bankrupt
Gift card holders sit as unsecured creditors, behind banks and other secured lenders. In retail bankruptcies, unsecured creditors typically receive partial payment or nothing.6Federal Reserve Bank of Boston. Gift Card Value When Issuers Go Bankrupt State gift card laws do not override federal bankruptcy law. If you hear a retailer is in trouble, spend the card.
If an Issuer Breaks the Rules
If a company charges you an illegal fee or refuses to honor a card that should still be valid, start with the issuer. Call customer service and cite the federal five-year rule. Many violations come from employee confusion rather than company policy, and a phone call often ends it.
If that fails, file a complaint with the Consumer Financial Protection Bureau. Gift cards fall under the CFPB’s prepaid cards category. You can submit online, and the CFPB will forward the complaint to the company and require a response.7Consumer Financial Protection Bureau. Submit a Complaint Your state attorney general’s consumer protection division enforces state-level gift card laws and is the right place for issues that turn on a state rule, such as a refused cash-back request or a prohibited fee in a state that bans them.