Gift card expiration dates and fees: the 5-year and 12-month rules

Gift cards are one of the most common holiday gifts, and also one of the most commonly forgotten. Federal rules limit how fast the money on most gift cards can expire or get eaten by fees. Here's what the rule says, in plain English.

Key takeaways

Funds on covered gift cards can't expire sooner than five years after the card was issued or last loaded.
Dormancy or inactivity fees are allowed only after 12 months with no activity, at most one per month, and must be disclosed on the card.
Promotional and reward cards (like a free bonus card) are generally excluded, so check their dates.

Which cards are covered

The rule is part of Regulation E, 12 CFR 1005.20 (Regulation E), Requirements for gift cards and gift certificates. It covers three types: gift certificates, store gift cards (usable at one merchant or group of affiliated merchants) and general-use prepaid cards (network-branded cards like a Visa or Mastercard gift card) that are bought for personal, family or household use.

Some cards are excluded, including loyalty, award or promotional gift cards (the "get a $10 bonus card when you buy $50" kind), as long as they carry the required disclosures, plus cards usable only for phone service and reloadable cards not marketed as gift cards. Promotional cards often expire in weeks, so use them first.

The expiration rule

No covered card can be sold with an expiration date unless:

The expiration date of the underlying funds is at least the later of five years after the card was issued (or funds were last loaded) or the card's own expiration date;
The card discloses the funds' expiration date (or that they don't expire), a toll-free number and a website if one exists, and if the plastic expires before the money does, that you can get a replacement; and
There's no fee to replace the card or get your remaining balance before the funds expire, unless the card was lost or stolen.

The card itself can expire before the money does. If that happens, contact the issuer for a replacement card.

The fee rule

A dormancy, inactivity or service fee can be charged only if:

There's been no activity on the card for the one-year period ending on the date the fee is charged;
The amount of the fee, how often it can be charged and that it's charged for inactivity are stated clearly on the card; and
No more than one such fee per calendar month.

Purchase or activation fees aren't covered by that rule, so a network-branded gift card may still cost a few dollars to buy. That's one reason a store-specific gift card can be better value when you know where the person shops.

Gift card checklist

Buy from the store's own register or website, not a third-party rack that may have been tampered with (see gift card scams).
Check the back for the funds expiration date, any fees and the support phone number.
Keep the receipt with the card until it's used up.
Use small leftover balances. Many stores let you split a payment between the card and another method.
State laws may give you more protection than the federal rule, such as cashing out small balances.

Published October 29, 2026. We do not use affiliate links on this page; see our Affiliate Disclosure.