| Quick Facts | Answer |
| Maximum / Limit | No Limit |
| Receipt Requirement | None |
| Inventory Requirement | None |
| Interest Requirement | None |
To learn about laws on security deposit returns in Vermont, click here.
Many cities and counties in Vermont have regulations which are more restrictive than those presented here. This article discusses Burlington and Brattleboro, but always check local laws.
Maximum Security Deposit Allowed in Vermont
Vermont state law does not limit the maximum security deposit, but local jurisdictions can establish their own limits. For example, Burlington and Brattleboro limit the maximum security deposit to one month’s rent.
Can Landlords Charge an Additional Pet Deposit in Vermont?
In Vermont, landlords can charge a pet deposit, except for service dogs and emotional support animals. There is no limit to the maximum pet deposit by state law, but local governments can establish their own rules. For example, the maximum pet deposit in Burlington and Brattleboro is one-half month’s rent.
How Much Rent Can a Landlord Collect Upfront in Vermont?
There is no limit on the amount of rent that can be collected upfront in Vermont. Many states have a limit on the amount of rent that can be collected at once, but Vermont does not. However, local governments may enact different rules.
Landlords in Burlington and Brattleboro can collect the first month’s rent in advance. However, they can only collect one additional month’s rent in advance, whether this is called a “security deposit” or “last month’s rent,” unless the tenant has a pet.
Security Deposit Collections in Vermont
While other states have additional requirements for landlords that collect a security deposit, such as providing certain documentation of the condition of the unit at move-in, Vermont does not. However, cities and towns may establish their own rules.
Do Landlords Have To Provide a Receipt for the Security Deposit in Vermont?
Although some states like Washington require a receipt, landlords are not required to provide a receipt for the security deposit in Vermont.
What Obligations Do Landlords Have To Establish the Condition at Move-in in Vermont?
Vermont law does not have specific obligations before a tenancy. While other states like Washington have pre-tenancy obligations like a written inventory of damages, Vermont does not. However, cities and towns may enact their own rules, like in Burlington.
Landlords in Burlington must provide a list of existing damage to the rental unit. The list must be signed by the landlord and tenant.
Security Deposit Holdings in Vermont
Vermont law does not require landlords to hold security deposits separate from other funds. Some other states mandate how and where security deposits are held, but Vermont does not. Unlike most states, Vermont does not allow local jurisdictions to regulate how or where a landlord holds a security deposit.
For example, a Burlington ordinance instructs landlords to hold security deposits in interest-bearing accounts. Since this conflicts with state law, it is unenforceable.
Are Tenants Entitled to Interest on Their Security Deposit in Vermont?
Vermont law does not require landlords to provide interest on held security deposits. However, state law allows local governments to establish their own rules regarding interest.
Burlington landlords are required to provide interest on held security deposits. The minimum rate is equal to the current interest provided by a Vermont bank passbook savings account.
How Are Security Deposits Accounted for in Vermont?
Security deposits are not considered taxable income when they are collected.
What Happens to a Security Deposit When the Property is Sold in Vermont?
When a property is sold in Vermont, the seller must transfer the security deposit to the new owner, who must handle it according to the same rules. The new landlord must notify each tenant of the transfer and provide their name and address.
Sources
- 1 Vt. Stat. tit. 9 § 4461(g)
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A town or municipality may adopt an ordinance governing security deposits on dwellings. The ordinance shall be supplemental to and not inconsistent with the minimum protections of the provisions of this section. The ordinance may not limit how a security deposit is held. The ordinance may authorize the payment of interest on a security deposit. The ordinance may provide that a housing board of review constituted pursuant to 24 V.S.A. § 5005 may hear and decide disputes related to security deposits upon request for a hearing by a landlord or tenant. The board’s actions shall be reviewable under 24 V.S.A. § 5006.
Source Link - 2 Burlington Code of Ord. § 18-120(a) & (b)
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(a) No other payments or deposits beyond the first month’s rental payment and the deposits described in this section may be required as a condition of rental, lease or occupancy of a rental unit as a dwelling.
(1) An owner may require a reasonable deposit as a condition for the rental, lease or occupancy of a rental unit as a dwelling as security against damage beyond normal wear and tear to the premises which is attributable to the tenant, against nonpayment of rent, against nonpayment of utility or other charges which the tenant was required to pay directly to the landlord or to a utility, and against expenses required to remove from the rental unit articles abandoned by the tenant. This deposit may not exceed the amount of one month’s rent for the unit rented and shall be held by the owner in an interest-bearing account, with an interest rate at least equivalent to a current Vermont bank passbook savings account. This deposit shall not be used by the tenant as the last month’s rent unless otherwise specified in a written lease agreement between the parties.
(2) In addition to the above-stated security deposit, an owner may require an additional payment equal to one-half (1/2) the amount of one month’s rent as a condition for allowing the occupants to have a pet or pets during the rental, lease or occupancy of a rental unit as a dwelling. Such additional payment may not be charged for any animal that mitigates a disability.
(b) At the beginning of any rental arrangement, the property owner(s) and tenant(s) shall prepare a list of existing damage to the premises. A dated, signed copy of such list shall be retained by both parties to the lease or rental arrangements for the purpose of assisting in the resolution of the deposit situation when the tenant vacates or abandons the rental unit.
Source Link - 3 Brattleboro Code of Ord. § 8-73
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(1) No other payments or deposits beyond the first month’s rental payment and the deposit described in this section may be required as a condition of rental, lease or occupancy of a rental unit as a dwelling.
(2) An owner may require a reasonable deposit as a condition for the rental, lease or occupancy of a rental unit as a dwelling as security against damage beyond normal wear and tear to the premises which is attributable to the tenant, against nonpayment of rent,against nonpayment of utility or other charges which the tenant is required to pay directly to the landlord or to a utility, and against expenses required to remove from the rental unit articles abandoned by the tenant. This security deposit may not exceed the amount of one month’s rent for the unit rented. This deposit shall not be used by the tenant as the last month’s rent unless otherwise specified in a written lease agreement between the parties.
(3) An owner may require an additional payment equal to one-half (1/2) the amount of one month’s rent as a condition for allowing the occupants to have a pet during the rental, lease or occupancy of a rental unit as a dwelling. Such additional payment may not be charged for any animal that mitigates a disability.
Source Link - 4 Vt. Stat. tit. 9 § 4461(f)
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Upon termination of the landlord’s interest in the dwelling unit, the security deposit shall be transferred to the new landlord. The new landlord shall give the tenant actual notice of the new landlord’s name and address with a statement that the security deposit has been transferred to the new landlord.
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