Do Gift Cards Expire in Massachusetts? The 7-Year Rule and Cash-Back Right

Gift cards sold in Massachusetts do expire, but not quickly. State law requires most store-issued gift cards and gift certificates to remain valid for at least seven years from the date they were sold.¹ If a card does not clearly show an expiration date and the retailer has not posted one on the receipt, website, or a toll-free number, the card never expires at all. That seven-year floor is one of the longest in the country, and the fine print that usually drains a card’s value, like dormancy fees and service charges, is banned outright.

How the Seven-Year Rule Works

Chapter 200A, Section 5D of the Massachusetts General Laws sets the floor. Any gift certificate sold in the state must stay valid for no fewer than seven years after the date of issuance.¹ The clock starts on the purchase date, not the first time the recipient uses the card. A retailer cannot reset the period by issuing a replacement card or by requiring activation.

Both the issuance date and the expiration date have to be printed clearly on the card itself. For electronic cards with a stored dollar value, those dates must appear on the sales receipt handed to the buyer at checkout, or be available through a website or toll-free phone number.²

And here is the detail worth remembering. If a gift card does not clearly display an expiration date and the retailer has not made that date available through any of those channels, the card is “redeemable in perpetuity” under the statute.¹ An old card you found in a drawer with no date printed on it is still good.

Which Cards the Rule Covers

The state defines “gift certificate” broadly under Chapter 255D, Section 1. It covers any writing or electronic card purchased by a buyer for someone else’s use, redeemable for goods or services at the seller’s business. That picks up traditional plastic gift cards, paper gift certificates, merchandise credits, and any other medium where the buyer paid full face value for future purchasing power.³

Two categories fall outside the state definition and lose the seven-year protection:

Prepaid calling cards, which are explicitly excluded.
Electronic cards usable at multiple unaffiliated retailers, such as Visa or Mastercard gift cards. These follow federal rules instead.³

Promotional gift certificates handed out as part of a marketing campaign can also carry shorter expiration dates, because the recipient did not pay full face value. A “$10 off” promotional card given with a purchase can set a 90-day deadline as long as that limit is disclosed up front. But any card where someone actually paid money for the balance gets the full seven-year window.

Visa and Mastercard Gift Cards Follow a Different Rule

The Visa, Mastercard, and American Express gift cards sold at drugstores and grocery stores do not get the Massachusetts seven-year protection. Because they can be used at multiple unaffiliated merchants, they fall outside the state definition and are instead governed by the federal Credit CARD Act of 2009.⁴

The federal rules are less generous in two ways:

Expiration: the card must stay valid for at least five years from the date of issuance or the last date funds were loaded, whichever is later.
Fees: dormancy, inactivity, or service fees are allowed after 12 months of no activity, with no more than one fee charged per month.⁴

So a $50 Visa gift card left in a desk for two years can quietly lose value to monthly fees. If you receive one of these, spend it reasonably soon. Fee terms must be disclosed on or with the card packaging, so check before you buy one as a gift. Complaints about bank-issued gift cards go to the Consumer Financial Protection Bureau rather than the state attorney general.⁵

No Dormancy or Service Fees on Store Cards

Massachusetts takes a hard line on fees. Chapter 266, Section 75D makes it a criminal offense to sell a gift certificate that imposes dormancy fees, service fees, administrative fees, or any other charge that reduces the card’s redeemable value. Violations carry a fine of up to $300 per offense.⁶

This is a flat ban, not a waiting period. Some states allow inactivity fees once a dormancy period passes. Massachusetts prohibits them entirely on store-issued gift cards. A retailer cannot charge you for checking your balance, for not using the card within a given window, or for any kind of maintenance on the account. If you see a fee policy printed on a gift card sold in Massachusetts, the retailer is already in violation.

Getting Cash for a Small Remaining Balance

Spending a card down to exactly zero can be awkward, especially when the leftover balance is too small to buy anything useful. The same statute that governs expiration also lets you cash out a small remainder.

The threshold depends on the type of card:

Non-reloadable cards: once you have used at least 90 percent of the original face value, you can ask the retailer for the remaining balance in cash. On a $50 card, that right kicks in once you have spent $45 or more.
Reloadable cards: if the remaining balance drops to $5.00 or less, you can request cash for the rest.¹

The choice belongs to you in both cases. The retailer must offer you the option to take cash or keep using the card. Not every cashier knows this rule, so you may need to ask a manager and point to the statute. Bring your receipt showing the remaining balance.

If a Store Refuses to Honor a Valid Card

A retailer that refuses to honor a valid, unexpired gift card is breaking the law, and the refusal can qualify as an unfair or deceptive practice under the Massachusetts Consumer Protection Act, Chapter 93A.⁷

Start at the store. Ask for a manager and bring your receipt or credit card statement showing when the card was purchased. Many refusals happen because a cashier does not know the law, and a manager can usually override the system on the spot. If the manager will not help, ask for a written explanation of why the card is being rejected.

If the store will not budge, file a complaint with the Attorney General’s Consumer Advocacy and Response Division. Complaints can be submitted online through the AG’s website.⁸ The division investigates patterns of violations and can pursue enforcement actions against businesses that routinely refuse valid cards.

For individual recovery, you can send a Chapter 93A demand letter describing what happened, the harm you suffered, and the relief you want. The business has 30 days to respond with a reasonable settlement offer, and sending the letter is a required first step before filing a 93A lawsuit.⁷ If the business ignores it or responds in bad faith, you can take the case to small claims court, which handles disputes up to $7,000 in Massachusetts.⁹ If the court finds the retailer’s conduct was willful or that the refusal to settle was in bad faith, you can recover two to three times your actual damages, plus attorney’s fees and costs.¹⁰ That multiplier is what gives the demand letter its teeth.

When the Retailer Goes Bankrupt

State expiration law does not help you if the company that issued the card files for bankruptcy. A gift card is essentially an IOU from the retailer, and when the retailer enters bankruptcy, that IOU becomes an unsecured claim against the company’s remaining assets.

In a Chapter 11 reorganization, where the business keeps operating while restructuring its debt, the company must petition the bankruptcy court for permission to keep honoring gift cards. It does not happen automatically. Some retailers request and receive that permission; others do not, which renders outstanding cards worthless unless the cardholder files a formal proof of claim with the court.¹¹ Even when a court allows redemption, the terms can be restrictive, such as requiring customers to spend twice the gift card balance in a single transaction before using it.

In a Chapter 7 liquidation, where the business shuts down entirely, gift card holders are treated as general unsecured creditors. That puts them near the back of the line behind secured lenders and priority claims, and most consumers recover pennies on the dollar or nothing. If you hear a retailer is in financial trouble, spend the card immediately.

Credit Slips for Returned Merchandise

Store credit from a return gets its own protection under Chapter 93, Section 14S. Like gift cards, credit slips must be valid for at least seven years.¹² If you return a sweater in January and the store issues merchandise credit, you have seven years to use it. Retailers sometimes print shorter deadlines on credit slips, but those deadlines are unenforceable if they fall inside the seven-year window.

1
General Court of Massachusetts. Massachusetts General Laws Chapter 200A, Section 5D – Gift Certificates; Validity; Expiration; Redemption
2
General Court of Massachusetts. Massachusetts General Laws Chapter 200A, Section 5D
3
General Court of Massachusetts. Massachusetts General Laws Chapter 255D, Section 1 – Definitions
4
Office of the Law Revision Counsel. 15 USC 1693l-1 – General-Use Prepaid Cards, Gift Certificates, and Store Gift Cards
5
Consumer Financial Protection Bureau. CFPB Begins Accepting Consumer Complaints on Prepaid Cards and Additional Nonbank Products
6
General Court of Massachusetts. Massachusetts General Laws Chapter 266, Section 75D – Imposition of Certain Fees Reducing Total Value Amount of Gift Certificate; Penalty
7
Mass.gov. The Massachusetts Consumer Protection Law
8
Mass.gov. File a Consumer Complaint
9
General Court of Massachusetts. Massachusetts General Laws Chapter 218, Section 21
10
General Court of Massachusetts. Massachusetts General Laws Chapter 93A, Section 9
11
Federal Reserve Bank of Boston. Gift Card Value When Issuers Go Bankrupt
12
General Court of Massachusetts. Massachusetts General Laws Chapter 93, Section 14S – Redemption of Credit Slips; Time Limitation