Landlords who understand Texas security deposit law can better avoid common issues like disputes over deductions, missed deadlines, unclear expectations with tenants, and problems caused by incomplete documentation or delayed communication at move-out.
In this guide, you’ll learn everything you need to know regarding these regulations, including maximum amounts landlords can request, how to store deposits, whether interest applies, legal reasons to deduct, returning deposits, handling disputes, and more.
Statutes Regulating Texas Security Deposits
Texas’s security deposit laws are outlined in Sections 92.101 through 92.111 of the Texas Property Code, which govern how landlords collect, hold, and return residential security deposits.
Maximum Security Deposit Amounts Under Texas Law
Texas security deposit law does not cap how much landlords can ask for, so choose an amount that suits your rental property and helps you cover potential repair or cleaning costs. No statewide caps exist, regardless of lease type or contract length.
Texas law does not create any exceptions to these rules, and no cities in the state enforce their own security deposit limits. State law fully controls how much landlords can collect.
Security Deposit Storage Regulations
Texas state does not require a special bank account, a separate holding account, or a receipt for a security deposit. Landlords can store the funds in any secure place they prefer, as long as they protect the deposit and follow all refund and deduction rules.
Security Deposit Interest in Texas
Texas law does not require landlords to place security deposits in interest-bearing accounts. They can hold the deposit in any type of bank account they prefer, and will never need to calculate or pay interest on the funds.
Making Security Deposit Deductions
Tenants sometimes default on rent or leave damage beyond normal wear and tear, and landlords need quick access to funds to cover lost expenses, make repairs, and return the unit to its previous condition.
When Landlords Can Deduct
Texas landlords can use a tenant’s security deposit in the following situations:
- Damage that goes beyond normal wear and tear and needs prompt repair
- Unpaid rent that remains at the end of the lease
- Excessive cleaning costs required to restore the unit to move-in shape
- Repair bills for fixtures or appliances that a tenant damages through misuse
- Costs tied to removing abandoned belongings that create extra work
When Landlords Can’t Deduct
Texas landlords cannot use a tenant’s security deposit in the following situations:
- Routine cleaning costs that reflect ordinary use over time
- Minor cosmetic marks that develop naturally during normal occupancy
- Repairs for issues that existed before the tenant moved in
- Expenses outside the tenant’s responsibilities listed in the lease
- Charges meant to cover general upgrades or improvements to the property
Necessary Documentation to Accompany Deductions
Texas law requires landlords to provide tenants with a written, itemized list of all deductions when they withhold any portion of the security deposit. If the deduction only involves unpaid rent and no one disputes the amount owed, landlords do not need to provide an itemized list.
What to Do When Deductions Are Greater Than the Deposit
Some tenants leave damage or unpaid charges that exceed the security deposit. In those situations, landlords can request additional payment from the former tenant and document each cost carefully. Texas law gives landlords the legal right to collect the full amount owed, even when the deposit falls short.
If the tenant refuses to pay the remaining balance, landlords should consider filing a claim through the relevant Texas small claims court or sending the debt to a collections agency.
Returning Security Deposits to Tenants
Texas law outlines clear steps for returning any remaining portion of a tenant’s security deposit after a landlord make all eligible deductions.
Required Timeline for Return
Landlords must return the tenant’s security deposit within 30 days after the tenant moves out and gives them a written forwarding address. (The 30-day clock starts once landlords receive that address.) Within that same period, landlords must send either the remaining funds or a written itemized list of all deductions to the tenant.
Method for Return
Texas law allows landlords to return the deposit using any standard payment method, including a check or another secure method. When landlords deduct any amount, they must include a clear itemized list that outlines each charge and shows any balance they still owe the tenant.
Penalties for Late Return
If a landlord ignores the 30-day rule or withholds funds in bad faith, Texas law allows the tenant to seek damages. Courts can award the tenant $100, up to 3 times the amount wrongfully withheld, and costs to cover reasonable attorney fees.
Security Deposit Disputes
Tenants hold the right to challenge how landlords handle their security deposit. To do so, most start by reviewing itemized deductions, negotiating directly with the landlord, and requesting any details they believe the landlord left out. If they can’t resolve the dispute on their own, tenants may try mediation or take the dispute to court.
As a landlord, prepare yourself for security deposit disputes by using move-in and move-out checklist forms, staying on top of accounting and bookkeeping, and adding clear terms to all future lease agreements. To strengthen your position further, keep thorough documentation, follow Texas deadlines closely, and review state rules on a regular basis.
Using Condition Reports to Document Damage
When dealing with security deposits in Texas, landlords should always use move-in and move-out condition reports to create a clear record of the unit’s condition at both stages. Doing so makes for better back-and-forth with tenants and helps support any deductions landlords need to make.
To simplify this process, use property management software to create digital reports with photos and videos directly from a smartphone. By documenting a property’s condition before move-in and after move-out, landlords build strong evidence that makes security deposit deductions far easier to enforce.
Sign up for a free TurboTenant account to streamline inspections, strengthen documentation, and stay fully prepared during every turnover.
FAQs: Texas Security Deposit Law
Can a landlord deduct painting from a security deposit in Texas?
Landlords can deduct painting costs only when a tenant causes damage beyond normal wear and tear. Routine repainting between tenants counts as standard maintenance, so landlords cannot charge a tenant for that work.
Are nail holes considered normal wear and tear in Texas?
Small nail holes from hanging lightweight items usually count as normal wear and tear in Texas. Larger holes, anchors, or excessive markings fall outside normal use and may justify a deduction when repairs are needed.
Who has to pay for carpet cleaning in Texas, the landlord or the tenant?
Landlords must cover standard carpet cleaning tied to normal turnover. If a tenant leaves stains, odors, or heavy dirt that calls for special cleaning or replacement, landlords can deduct those expenses from the security deposit.
What happens if a landlord doesn’t return a security deposit within 30 days in Texas?
If a landlord misses the 30-day deadline or fails to send an itemized deduction list after receiving the tenant’s forwarding address, Texas law may treat the delay as bad faith. In these cases, courts can award the tenant $100, up to 3 times the amount wrongfully withheld, and reasonable attorney fees.
