More and more each holiday season gift cards are purchased for gift giving. It is a good way to make sure the recipient can get the gift they want; no worry about size or wrong color, or an un-cool item.

Then the happy recipient takes their gift card to make a purchase of that perfect item; but alas, after the purchase there are a few bucks left on the gift card. The card is then tossed to the back of the glove box, into a drawer at home or any number of other “safe” places never to be used again. But wait! That is all going to change…

Effective January 1, 2008 a new California law (SB-250) takes effect allowing holders of any gift card/certificate with a cash value of less than $10 to redeem the gift card for its remaining cash value.

Stay calm. The new gift card redemption law does have exemptions; the same exemptions in the law (California Civil Code Section 1749.5) that allows certain gift cards to have expiration dates are also applied to the redemption of gift cards for cash. Also, any gift cards issued as an award, loyalty or promotional program, gift cards sold at volume discount to employers, non-profits, or charities for fundraising purposes cannot be redeemed for cash.

The current gift certificate law states that a seller must either redeem a gift certificate or gift card sold after January 1, 1997, for its cash value, or replace it with a new certificate or card at no cost. Most sellers opted to issue a new card/certificate. With SB-250 the seller must redeemed gift cards/certificates for cash.

California Civil Code Section 1749.5 (PDF)

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