In Florida, if a landlord does not intend to make deductions, they must return security deposits (with interest) to tenants within 15 days of the end of the lease. If they intend to make deductions, they have 30 days to notify the tenant of their intent.
Maximum Security Deposit Charge in Florida
Florida Statutes do not limit the amount Florida landlords can charge as security deposit charge. However, cities and counties within Florida are can put a cap on the amount. Check with the municipality where the property to be rented is located, to be sure.
Additional Pet Deposits. Under Florida’s law, the landlord may ask for an additional pet deposit; however, people with disabilities who use service animals are entitled to full and equal access to housing. Thus, the tenant may not be discriminated against and the landlord may not require the tenant to pay extra to have a service animal. If the service animal causes damage to the rental unit, the tenant is liable to pay for any damages.
The Federal Fair Housing Act requires housing facilities to allow tenants who use service dogs and emotional support animals to have an equal opportunity to use and enjoy their home.
Security Deposit Holdings in Florida
Florida landlords have three options when storing security deposits in an account. Below are the three options and the specific duties relating to them:
- The landlord can choose to place the security deposit in a non-interest bearing account in a Florida bank. The landlord is not allowed to use this account for funds other than security deposits.
- The landlord can choose to keep the money in an interest-bearing account in a Florida bank. In this case, the landlord must give or credit to the tenant either 75% of the interest earned from the account or 5% simple interest per year on the amount of security deposit. The landlord is also prohibited from using this account for funds other than security deposits.
- The landlord can choose to post a security bond from a surety company that’s licensed as such by the clerk of the circuit court in the county where the unit is. In addition to the bond, the landlord must pay a 5% simple annual interest on the amount of deposit. The bond should be conditioned upon the landlord complying with duties concerning the security deposit (e.g. holding, accounting for, returning, etc.). The bond should be for the lesser of $50,000 or the total amount of security deposit that the landlord is holding for all the tenants for all the rental units. (However, if the landlord is renting units in five or more counties , the landlord has the option of posting a bond with the Secretary of State for $250,000 or the total amount of all security deposits the landlord is holding, whichever is less, instead of posting a bond in each county.)
If the landlord is renting out five or more individual dwelling units, the landlord must provide the tenant with written notice of how the security deposit is being held. The landlord has 30 days after receiving the security deposit to choose how to hold the deposit and notify the tenant of the details of the same. However, the landlord has the option of predetermining the manner of holding and including the required written notice in the lease or rental agreement.
The written notice must be given in person or by mail and must include the following information:
- State the name and address of the depository where the security deposit is being held or state that the landlord has posted a surety bond.
- State if the tenant is entitled to interest on the security deposit.
- Include the following disclosure:
YOUR LEASE REQUIRES PAYMENT OF CERTAIN DEPOSITS. THE LANDLORD MAY TRANSFER ADVANCE RENTS TO THE LANDLORD’S ACCOUNT AS THEY ARE DUE AND WITHOUT NOTICE. WHEN YOU MOVE OUT, YOU MUST GIVE THE LANDLORD YOUR NEW ADDRESS SO THAT THE LANDLORD CAN SEND YOU NOTICES REGARDING YOUR DEPOSIT. THE LANDLORD MUST MAIL YOU NOTICE, WITHIN 30 DAYS AFTER YOU MOVE OUT, OF THE LANDLORD’S INTENT TO IMPOSE A CLAIM AGAINST THE DEPOSIT. IF YOU DO NOT REPLY TO THE LANDLORD STATING YOUR OBJECTION TO THE CLAIM WITHIN 15 DAYS AFTER RECEIPT OF THE LANDLORD’S NOTICE, THE LANDLORD WILL COLLECT THE CLAIM AND MUST MAIL YOU THE REMAINING DEPOSIT, IF ANY.
IF THE LANDLORD FAILS TO TIMELY MAIL YOU NOTICE, THE LANDLORD MUST RETURN THE DEPOSIT BUT MAY LATER FILE A LAWSUIT AGAINST YOU FOR DAMAGES. IF YOU FAIL TO TIMELY OBJECT TO A CLAIM, THE LANDLORD MAY COLLECT FROM THE DEPOSIT, BUT YOU MAY LATER FILE A LAWSUIT CLAIMING A REFUND.
YOU SHOULD ATTEMPT TO INFORMALLY RESOLVE ANY DISPUTE BEFORE FILING A LAWSUIT. GENERALLY, THE PARTY IN WHOSE FAVOR A JUDGMENT IS RENDERED WILL BE AWARDED COSTS AND ATTORNEY FEES PAYABLE BY THE LOSING PARTY.
THIS DISCLOSURE IS BASIC. PLEASE REFER TO PART II OF CHAPTER 83, FLORIDA STATUTES, TO DETERMINE YOUR LEGAL RIGHTS AND OBLIGATIONS.
Change in the Manner of Holding: Should the landlord change the manner or location of holding the security deposit, the landlord will have 30 days from the day the change was made to notify the tenant of the same through a written notice, delivered in the same manner, with all the information as required in the above enumeration except for the disclosure in number 5. This change includes the instance where the landlord transfers the same into a different bank or bank account. The landlord is not required to give a new notice solely because the depository has merged with another financial institution, transferred ownership to a different financial institution, or changed its name.
Allowable Deductions on Security Deposits in Florida
If part of the security deposit was intended to be advance rent , the landlord may take out the corresponding amounts as they become due without notice to the tenant but only for the months where advance rent payments were intended. For all other amounts to be taken from the tenant’s security deposit, the landlord must follow the rules below.
Florida landlords may deduct from the security deposit the following:
- Unpaid rent.
- Cost of monetary damage caused by the tenant’s breach of the lease.
- Cost of repairs for damage to the unit in excess of normal wear and tear.
- Charges allowed to be deducted under the lease (e.g. early termination fee).
Can the deposit be used by the tenant as last month’s rent? Not usually, but it can be done if there is a written agreement between the parties to do so.
“Normal Wear and Tear” vs. Damage
- “Normal wear and tear” refers to the deterioration of the property that happens when the property is used as it was meant to be used and only when that deterioration occurs without negligence, carelessness, accident, misuse, or abuse by the tenant or the people the tenant brings there. They are minor issues that occur naturally like aging and expected decline as a result of everyday living. These can include gently worn carpets, loose door handles, fading wall paint and flooring, stained bath fixtures, lightly scratched glass, dirty grout and mold that occur naturally.
- “Damage” refers to the destruction that occurs because of abuse or negligence by a tenant during the tenancy and can affect usefulness, value, normal function of the rental unit. Pet damage (heavily stained and ripped carpet), broken tiles, hole in the wall, broken windows and missing fixtures are all examples of damage.
Check out our article on “wear and tear” vs. “damage” to get a better idea of the difference and visit our state laws page to learn more about other landlord-tenant responsibilities.
Returning Security Deposits in Florida
Time Frame: The landlord must return the security deposit within 15 days from the time the tenant vacates the unit to return the security deposit if there will be no deductions. If the landlord intends to make deductions, the landlord must provide the tenant with written notice of deductions.
Failure to Return the Security Deposit on Time: Florida statutes do not provide a specific penalty on the landlord’s failure to return the security deposit on time. However, should the landlord fail or refuse to return it, the tenant may sue the landlord for the return of the same. If the tenant wins, the tenant will be entitled to the costs of the suit and reasonable attorney’s fees . However, if the landlord wins, the tenant will be the one to pay for the landlord’s costs.
Written Notice of Deductions: The landlord has 30 days after the tenant vacates the unit to provide this written notice. If the landlord fails to do so, the landlord’s rights to charge anything or hold on to the security deposit will be forfeited . The notice must be sent to the tenant via certified mail and must contain a notice that more or less states the following:
This is a notice of my intention to impose a claim for damages in the amount of___________ upon your security deposit, due to________________. It is sent to you as required by Section 83.49(3), Florida Statutes. You are hereby notified that you must object in writing to this deduction from your security deposit within 15 days from the time you receive this notice or I will be authorized to deduct my claim from your security deposit. Your objection must be sent to (landlord’s address).
The tenant will then have 15 days after receiving the notice to dispute the claims or charges. If the tenant does not object to the charges, then the landlord may deduct the amounts as detailed in the written notice and return the remainder of the security deposit, if any, within 30 days from the date of the written notice that was sent to the tenant.
Forfeiture of the Tenant’s Right to Written Notice: Where the lease has no fixed term or where the lease has a fixed term but the tenant wants an early termination of the same, the tenants must give the landlord at least seven days’ notice in writing before vacating the unit. The notice of termination must include a forwarding address where the tenant may be reached. Failure to do so will relieve the landlord of the latter’s duty to provide the written notice of deductions discussed above.
Security Deposits and Tax Filing in Florida
How the security deposit will be treated tax-wise depends on whether or not the landlord gets to keep it (or part of it).
Taxable Income: Security deposits are not automatically considered income when the landlord receives them. The IRS advises to not include security deposits as income if the landlord may still be required to return the same. They only become taxable income when the landlord no longer has any obligation to refund them. For example, if the security deposit was given in 2020 but was only forfeited in 2021, then the landlord should only include it as income in 2021.
Reporting Security Deposit as Income: Whether or not security deposit should be reported as income and when to do so will depend on what it is being applied to or used as. Below are three simple rules the IRS has suggested to follow:
- If the deposit is forfeited due to a breach of the lease or applied to unpaid rent, then the amount kept should be declared as income in the year it was forfeited or applied.
- If the security deposit is used to cover expenses that are chargeable to it, then the landlord should only include the part of the deposit used as income if the landlord includes the cost of repairs as expenses. If the landlord doesn’t include them as expenses as a matter of practice, then there’s no need to include the part of the deposit kept to cover them as income.
- If there is an agreement between the parties to use the deposit or part of it as the final month’s rent, then the landlord should include it as income when the same is received.
Additional Rules & Regulations in Florida
Receipt Requirements: The landlord is not required to provide a receipt for the security deposit in Florida.
Security Deposit Interest in Florida: Florida landlords are required to pay interest on the security deposit except when the same is placed in a non-interest bearing account. If the security deposit is placed in an interest-bearing account then the tenant is entitled to either 75% of the interest earned from the bank, or 5% on the amount of security deposit, whichever the landlord decides. If the landlord opted to post a bond, then the tenant is entitled to a 5% interest on the security deposit. When interest is payable to the tenant, the landlord can either pay the tenant directly or credit it as rent, either way, the landlord must do this at least once a year . That said, the tenant forfeits rights to interest when the tenant wrongfully terminates the lease prior to the end of its term.
New Property Owner’s Responsibility: If the rental property is sold while the lease subsists, the buyer inherits the previous owner’s obligation to refund the tenant’s security deposit when the lease ends. The landlord is required to transfer the security deposit and provide an accurate accounting for the same, especially when the property sold consists of several rental units. The landlord will not be relieved of his duties related to the security deposit unless he does so.
For additional questions about security deposits in Florida, please refer to the official state legislation, Florida Statutes § 83.49, for more information.
Sources
- 1 FL Stat § 83.49 (2019)
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“…Hold the total amount of such money in a separate non-interest-bearing account in a Florida banking institution for the benefit of the tenant or tenants. …”
- 2 FL Stat § 83.49 (2019)
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“…The landlord shall not commingle such moneys with any other funds of the landlord or hypothecate, pledge, or in any other way make use of such moneys until such moneys are actually due the landlord…”
- 3 FL Stat § 83.49 (2019)
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“… Hold the total amount of such money in a separate interest-bearing account in a Florida banking institution for the benefit of the tenant or tenants, in which case the tenant shall receive and collect interest in an amount of at least 75 percent of the annualized average interest rate payable on such account or interest at the rate of 5 percent per year, simple interest, whichever the landlord elects…”
- 4 FL Stat § 83.49 (2019)
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“…The landlord shall not commingle such moneys with any other funds of the landlord or hypothecate, pledge, or in any other way make use of such moneys until such moneys are actually due the landlord…”
- 5 FL Stat § 83.49 (2019)
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“…Post a surety bond, executed by the landlord as principal and a surety company authorized and licensed to do business in the state as surety, with the clerk of the circuit court in the county in which the dwelling unit is located in the total amount of the security deposits and advance rent he or she holds on behalf of the tenants or $50,000, whichever is less…”
- 6 FL Stat § 83.49 (2019)
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“…In addition to posting the surety bond, the landlord shall pay to the tenant interest at the rate of 5 percent per year, simple interest…”
- 7 FL Stat § 83.49 (2019)
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“…The bond shall be conditioned upon the faithful compliance of the landlord with the provisions of this section…”
- 8 FL Stat § 83.49 (2019)
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“…A landlord… engaged in the renting of dwelling units in five or more counties, who holds deposit moneys or advance rent and who is otherwise subject to the provisions of this section, may, in lieu of posting a surety bond in each county, elect to post a surety bond in the form and manner provided in this paragraph with the office of the Secretary of State…”
- 9 FL Stat § 83.49 (2019)
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“…The bond shall be in the total amount of the security deposit or advance rent held on behalf of tenants or in the amount of $250,000, whichever is less…”
- 10 FL Stat § 83.49 (2019)
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“…This subsection does not apply to any landlord who rents fewer than five individual dwelling units…”
- 11 FL Stat § 83.49 (2019)
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“…The landlord shall, in the lease agreement or within 30 days after receipt of advance rent or a security deposit, give written notice to the tenant which includes disclosure of the advance rent or security deposit…”
- 12 FL Stat § 83.49 (2019)
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“…Be given in person or by mail to the tenant…”
- 13 FL Stat § 83.49 (2019)
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“…he or she must notify the tenant within 30 days after the change as provided in paragraphs (a)-(d)…”
- 14 FL Stat § 83.49 (2019)
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“…The landlord or the landlord’s agent may disburse advance rents from the deposit account to the landlord’s benefit when the advance rental period commences and without notice to the tenant…”
- 15 FL Stat § 83.43 (2019)
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“…“Security deposits” means any moneys held by the landlord as security for the performance of the rental agreement, including, but not limited to, monetary damage to the landlord caused by the tenant’s breach of lease prior to the expiration thereof…”
- 16 FL Stat § 83.49 (2019)
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“…If either party institutes an action in a court of competent jurisdiction to adjudicate the party’s right to the security deposit, the prevailing party is entitled to receive his or her court costs plus a reasonable fee for his or her attorney…”
- 17 FL Stat § 83.49 (2019)
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“…the landlord shall have 30 days to give the tenant written notice by certified mail to the tenant’s last known mailing address of his or her intention to impose a claim on the deposit and the reason for imposing the claim…”
- 18 FL Stat § 83.49 (2019)
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“…If the landlord fails to give the required notice within the 30-day period, he or she forfeits the right to impose a claim upon the security deposit and may not seek a setoff against the deposit but may file an action for damages after return of the deposit…”
- 19 FL Stat § 83.49 (2019)
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“…Unless the tenant objects to the imposition of the landlord’s claim or the amount thereof within 15 days after receipt of the landlord’s notice of intention to impose a claim…”
- 20 FL Stat § 83.49 (2019)
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“…the landlord may then deduct the amount of his or her claim and shall remit the balance of the deposit to the tenant within 30 days after the date of the notice of intention to impose a claim for damages…”
- 21 FL Stat § 83.49 (2019)
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“…any tenant who vacates or abandons the premises prior to the expiration of the term… or any tenant who vacates or abandons premises which are the subject of a tenancy from week to week, month to month, quarter to quarter, or year to year, shall give at least 7 days’ written notice by certified mail or personal delivery to the landlord prior to vacating or abandoning the premises which notice shall include the address where the tenant may be reached…”
- 22 FL Stat § 83.49 (2019)
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“…Failure to give such notice shall relieve the landlord of the notice requirement of paragraph (3)(a) but shall not waive any right the tenant may have to the security deposit or any part of it…”
- 23 FL Stat § 83.49 (2019)
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“…In those cases in which interest is required to be paid to the tenant, the landlord shall pay directly to the tenant, or credit against the current month’s rent, the interest due to the tenant at least once annually…”
- 24 FL Stat § 83.49 (2019)
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“…However, no interest shall be due a tenant who wrongfully terminates his or her tenancy prior to the end of the rental term…”
- 25 FL Stat § 83.49 (2019)
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“…Upon the sale or transfer of title of the rental property from one owner to another… all security deposits… being held for the benefit of the tenants shall be transferred to the new owner or agent, together with any earned interest and with an accurate accounting showing the amounts to be credited to each tenant account.”
- 26 FL Stat § 83.49 (2019)
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“…Upon the transfer of such funds and records to the new owner or agent, and upon transmittal of a written receipt therefor, the transferor is free from the obligation imposed in subsection (1) to hold such moneys on behalf of the tenant…”
- 27 FL Stat § 83.49 (2019)
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“…if the landlord does not intend to impose a claim on the security deposit, the landlord shall have 15 days to return the security deposit together with interest if otherwise required…”