The Restrictive Endorsement
validation feature is designed to reduce the risk of a check being deposited multiple times at different financial institutions, taken to a check casher or even being accidentally deposited through mobile deposit again at a later date.
One procedure to reduce the potential trust fund liability is to place a restrictive endorsement
on the back of each check, which may be worded as "Payment for the amount of $ -- to be applied to Trust Fund Only for the time period --.
In such cases, if the business is operating, the corporation can voluntarily designate that tax payments be directed first to trust fund taxes, for which the president would be personally liable, by including a restrictive endorsement
on the back of the check stating: "To be directed for payment of trust fund taxes of XYZ Corporation.
Florida agents must thoroughly review and understand the breadth and implications of these restrictive endorsements
and, where alternative coverage is not available, ensure that their policyholders are fully informed.
In 2001, however, carriers are actively investigating and implementing restrictive endorsements
Have any powdery substance on the outside; - Are unexpected or from someone unfamiliar to you; - Are addressed to someone no longer with your organization or home or are otherwise outdated; - Have no return address, or have one that can't be verified as legitimate; - Are of unusual weight, given their size, or are lopsided or oddly shaped; - Have an unusual amount of tape on them; - Are marked with restrictive endorsements
, such as "Personal" or "Confidential;" - Have strange odors or stains; - Show a city or state in the postmark that doesn't match the return address.
Packages marked with restrictive endorsements
such as ``Personal'' or ``Confidential.