Washington, D.C. landlords who understand the District’s security deposit law are better equipped to avoid disputes, improper deductions, and missed return deadlines.
In this guide, you’ll learn everything you need to know about 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 Washington, D.C. Security Deposits
Washington, D.C.’s security deposit laws are outlined in D.C. Code § 42-3502.17, which governs how landlords collect, hold, deduct from, and return security deposits for residential properties. The law also covers requirements for paying interest on those deposits.
Maximum Security Deposit Amounts Under Washington, D.C. Law
In Washington, D.C. landlords can collect a security deposit of up to 1 month’s rent for most residential leases. This amount is the same regardless of the lease type or length, ensuring a standard approach across different rental agreements.
There are no exceptions to the maximum security deposit amount under Washington, D.C. law. Additionally, no local neighborhoods within Washington, D.C. have their own security deposit limits that override the state regulations.
Security Deposit Storage Regulations
Washington, D.C. does not have specific rules for how landlords must store security deposits, meaning landlords have the flexibility to store deposits securely, whether in a separate bank account or another safe method, as long as they follow the required return procedures.
Security Deposit Interest in Washington, D.C.
Washington, D.C. landlords must hold security deposits in a separate, interest-bearing escrow account at a financial institution located in the District and must pay tenants interest on the deposit at the rate set annually by the District, either at the end of each year or upon termination of the tenancy, as required by law.
Making Security Deposit Deductions
Making deductions from security deposits is crucial to maintaining the overall condition of a rental property. Tenants sometimes default on rent or cause damage beyond normal wear and tear, and landlords rely on the security deposit to cover these costs.
When Landlords Can Deduct
Washington, D.C. landlords can draw from a tenant’s security deposit for the following reasons:
- Damage beyond normal wear and tear that requires repair
- Unpaid rent or other amounts owed under the rental agreement
- Costs for removing abandoned property left behind by the tenant
- Cleaning expenses to restore the unit to its original condition
- Repairing unauthorized alterations or changes made by the tenant
When Landlords Can’t Deduct
Washington, D.C. landlords cannot draw from a tenant’s security deposit for the following reasons:
- Normal wear and tear that results from regular use of the property
- Damage due to aging, deterioration, or expected depreciation
- Minor cosmetic issues that don’t require actual repair
- Cleaning needed for routine turnover between tenants
- Issues that fall under the landlord’s responsibility
Necessary Documentation to Accompany Deductions
Washington, D.C. landlords must provide tenants with a written itemized statement whenever they make deductions from the security deposit. The statement should clearly list each deduction and its cost. Landlords don’t need to provide receipts or invoices unless the tenant requests them.
What to Do When Deductions are Greater Than the Deposit
In some cases, tenant damage or unpaid charges may exceed the amount of the security deposit. When this happens, Washington, D.C. landlords may seek payment of the remaining balance from the former tenant. The landlord must still provide a written, itemized list of deductions within the required statutory timeframe.
If the tenant refuses to pay, the landlord can file a claim in Washington, D.C. small claims court to recover the additional funds.
Returning Security Deposits to Tenants
Washington, D.C. law clearly outlines how landlords must return any remaining funds from a tenant’s security deposit after making eligible deductions.
Required Timeline for Return
Within 45 days after the tenancy ends, a landlord must either return the full security deposit or provide the tenant with written notice of the intent to withhold any portion of the deposit. If the landlord provides notice of intent to withhold, the landlord then has 30 days after that notice to return any remaining balance of the deposit, along with a written, itemized statement of deductions. These obligations apply once the landlord regains possession of the unit and the tenant has provided a forwarding address.
Method for Return
Landlords can return the security deposit by check, cash, or another reasonable method, such as electronic transfer. If the landlord withholds any portion of the deposit, they must provide an itemized list of deductions within the initial 45-day return period.
Penalties for Late Return
If a landlord fails to comply with Washington, D.C.’s security deposit return requirements, the tenant may recover the full deposit. In cases of wrongful withholding, the landlord may also be liable for up to double the amount wrongfully withheld, as well as reasonable attorney’s fees.
Security Deposit Disputes
If a tenant disagrees with how the landlord handles their security deposit, they have every right to raise a dispute. Typically, they will request clarification on any deductions, ask for an itemized list, or seek mediation. In more serious cases, tenants can pursue legal action to recover the funds.
As a landlord, prepare for security deposit disputes by using move-in and move-out checklists, staying on top of accounting and bookkeeping, and including clear terms within all lease agreements. Proper documentation, a solid understanding of D.C. laws, and careful attention to timelines will also help you protect your best interests.
Using Condition Reports to Document Damage
When managing security deposits in Washington, D.C., landlords should use detailed move-in and move-out condition reports to document the property’s condition, provide valuable evidence in disputes, and ensure smooth returns of a tenant’s funds.
To do so, consider using property management software to create digital reports, including photos and videos, directly from a smartphone. By documenting a property’s condition both before move-in and after move-out, you can make security deposit deductions non-negotiable.
Sign up for a free TurboTenant account to streamline your entire security deposit process, from collection to return.
FAQs: California Security Deposit Law
Can a landlord deduct painting from a security deposit in Washington, D.C.?
A landlord in Washington, D.C. can deduct painting costs from a tenant’s security deposit only if the tenant caused damage beyond normal wear and tear. Routine painting that occurs after a standard tenancy remains the landlord’s responsibility and cannot be deducted.
Are nail holes considered normal wear and tear in Washington, D.C.?
In Washington, D.C., small nail holes from lightweight items, like picture hangers, are generally considered normal wear and tear. However, larger holes or damage caused by heavy items may qualify as damage, and landlords can deduct the repair costs from the security deposit.
Does the landlord or tenant have to pay for carpet cleaning in Washington, D.C.?
In Washington, D.C., landlords can charge tenants for carpet cleaning if the tenant leaves excessive stains, dirt, or other damage beyond normal wear and tear. Routine cleaning between tenants is the landlord’s responsibility and should not be deducted from the security deposit.
What happens if a landlord doesn’t return a security deposit within 30 days in Washington, D.C.?
If a landlord fails to comply with Washington, D.C.’s security deposit return requirements, the tenant may take legal action to recover the full deposit. In cases of wrongful withholding, the landlord may also be liable for up to double the amount wrongfully withheld, as well as reasonable attorney’s fees.
