Alaska security deposit law gives landlords the clarity they need to avoid unclear deductions, missed return deadlines, and confusion about handling tenant funds. Landlords who understand these rules often avoid costly disputes and stay compliant with state law.
In this guide, you’ll learn everything you need to know about maximum deposit amounts, proper storage, required interest, lawful deductions, returning deposits, resolving disputes, and more.
Statutes Regulating Alaska Security Deposits
Alaska’s security deposit rules are outlined in AS 34.03.070 of the Alaska Statutes, which govern how landlords collect, hold, and return security deposits and prepaid rent.
Maximum Security Deposit Amounts Under Alaska Law
Alaska law limits the combined total of security deposits and prepaid rent to 2 months of rent when the monthly rent is $2,000 or less. When rent exceeds $2,000, the statute imposes no maximum. These limits apply across types of standard residential leases.
Alaska also permits a separate refundable pet deposit of up to 1 month of rent, collected in addition to the standard limit. State law does not include other exceptions to these rules.
Security Deposit Storage Regulations
Alaska law requires landlords to promptly deposit all security deposits and prepaid rent into a trust account with a bank, savings and loan association, or licensed escrow agent. Landlords may combine deposits and prepaid rent into a single account, but they must keep those funds separate from personal funds.
For example, a landlord cannot store a tenant’s deposit in the same personal account used to pay household or business expenses.
Security Deposit Interest in Alaska
Alaska law requires landlords to place security deposits in an interest-bearing trust account when practicable. Landlords who manage subletting arrangements also follow this rule.
Landlords must pay tenants the interest earned on the account. If the account does not produce interest, landlords must pay a rate equal to 1 percentage point above the annual rate the 12th Federal Reserve District charges member banks on the day the rental agreement begins.
Making Security Deposit Deductions
Landlords rely on security deposit deductions to keep a rental property in strong condition. Tenants sometimes leave damage beyond normal wear and tear, and landlords need funds available to restore the unit to its previous condition. This approach also helps landlords maintain reliable turnover when they manage subletting arrangements.
When Landlords Can Deduct
Alaska landlords may draw from a tenant’s security deposit for the following reasons:
- Repairing damage that exceeds normal wear and tear
- Restoring cleanliness to the level documented at move-in
- Replacing items that the tenant breaks or removes during the lease
- Covering unpaid rent the tenant leaves at the end of the term
- Paying utility charges the tenant leaves outstanding at move-out
When Landlords Can’t Deduct
Alaska landlords may not draw from a tenant security deposit for the following reasons:
- Addressing deterioration that qualifies as normal wear and tear under state law
- Charging for improvements that upgrade the property
- Deducting for minor cosmetic issues that occur through ordinary use
- Billing tenants for cleaning when the unit matches its move-in condition
- Charging for repairs required because the landlord did not maintain essential systems
Necessary Documentation to Accompany Deductions
Alaska law requires landlords who withhold any part of a security deposit to send an itemized statement that lists unpaid rent and damages. Landlords must mail this notice to the tenant’s last known address within the statutory deadline.
Landlords do not have to include repair receipts or invoices, though keeping them helps support deductions if a dispute arises.
What to Do When Deductions are Greater Than the Deposit
Some tenants default on rent or leave damage that exceeds the security deposit. In these cases, landlords can request payment directly from the former tenant and attempt negotiation. If they’re unable to collect what they’re owed, landlords can file a claim in Alaska small claims court or send the matter to a collections agency..
Returning Security Deposits to Tenants
Alaska law requires landlords to return any remaining portion of a tenant security deposit after applying eligible deductions.
Required Timeline for Return
When a tenant moves out and returns possession, landlords must mail the refund and itemized statement within 14 days if no deductions apply. If landlords deduct for damages, unpaid rent, or other valid charges, they must send the refund and list of deductions within 30 days.
Method for Return
Landlords may return the deposit by check, cash, or another method that reaches the tenant at a last known or forwarding address. Landlords should keep records of how and when the deposit was sent. The return must include a written, itemized list explaining each deduction.
Penalties for Late Return
If a landlord willfully misses the return deadline or fails to provide the required itemized notice, the tenant may recover up to twice the amount wrongfully withheld. Courts may impose this penalty even if the landlord eventually returns the deposit.
Security Deposit Disputes
Tenants who disagree with how a landlord handles a security deposit have every right to raise a dispute. Most start by sending a written request for clarification, and if that does not resolve the issue, they may seek mediation or take the matter to court.
Landlords prepare for potential disputes by using move-in and move-out checklist tools, staying current on accounting and bookkeeping, and including clear terms in a strong lease agreement. Detailed documentation, knowledge of Alaska law, and strict attention to statutory timelines also help landlords avoid conflict.
Using Condition Reports to Document Damage
Landlords who manage security deposits in Alaska benefit from using detailed condition reports to track changes in a unit’s condition, set clear expectations, and resolve disagreements with departing tenants.
You can streamline this workflow by using property management software to create digital reports with photos and videos directly from a smartphone. Clear documentation creates a reliable record and makes any security deposit deductions far less disputable.
Sign up for a free TurboTenant account to collect deposits, build organized digital reports, and simplify every inspection.
FAQs: Alaska Security Deposit Law
Can a landlord deduct painting from a security deposit in Alaska?
A landlord may deduct painting costs only when a tenant causes damage beyond normal wear and tear. Routine repainting that occurs during normal turnover does not qualify as an allowable deduction under Alaska law.
Are nail holes considered normal wear and tear in Alaska?
Small nail holes from hanging pictures usually count as normal wear and tear in Alaska. Larger holes, wall anchors, or excessive marks that require extra repair can justify a valid deduction.
Does the landlord or tenant have to pay for carpet cleaning in Alaska?
A landlord may deduct carpet cleaning costs only when a tenant leaves the carpet unusually dirty or damaged. Standard cleaning that occurs between tenants as part of typical turnover does not qualify as a deductible charge.
What happens if a landlord doesn’t return a security deposit within 14 or 30 days in Alaska?
If a landlord misses the 14- or 30-day deadline in Alaska, depending on whether deductions apply, the tenant may recover up to twice the amount the landlord wrongfully withheld.
