I'm wondering if anyone else has this problem and how they handle it. I often have people overpay for their hot check by one or two cents or even up to $1 or $2 over. So then we have to write them a refund check (because I only accept money orders or cashiers checks, no cash). Then they never cash their refund check. Is there a better way to handle it? I'm talking about the people who do this via mail so I can't send them away to go get the correct amount and bring it back.

Maybe notify the payor of the overpayment by letter and indicate that to claim the amount of the overpayment, the payor should send a letter to your office indicating that they are requesting a refund of the overpayment. Then hold the "overpayment" in a separate account (to keep your books straight). If not claimed in the statutory period (a year?), then forward to the Comptroller as unclaimed property. That should keep you in the clear, avoid spending $$ that is not actually "yours", and simplify reconciling your bank statements. It sounds like this may be similar to those "over pay your ticket" themes you see on the internet. I would be VERY surprised if you get more than 1 or 2 letters per year requesting a refund. Plus, the cost of sending the letter is probably less than the cost of preparing and mailing a check.

problem there looks like it would cost you .39 cents to send someone notice that they are owed .02 cents? (Guess that just might be what they were hoping for).

I'd make sure your letter tells them that they have to send a self addressed stamped envelope with which to send them their check for pennies.