West Virginia landlords may require a security deposit from tenants when entering a lease agreement. It provides a level of security when they experience financial losses as a result of tenants’ non-compliance with lease obligations. It’s crucial for landlords to adhere to the security deposit law that governs the landlord-tenant relationship.
Quick Facts for West Virginia
- Maximum Amount: No limit
- Duration for Return: 60 days after end of lease
- Other Return Requirements: Itemized list of any damages
- Penalty for Late Returns: Landlord will pay the full refund, plus any damages
The Purpose of a Security Deposit
Security deposits serve as a safety net for landlords should they suffer financial losses caused by the tenant, who may have damaged the rental property, or breach the lease agreement, or skipped on the rent.
Security Deposit Maximum in Vermont
West Virginia has no established maximum amount that a landlord can charge a tenant for a security deposit.
Returning a Tenant’s Security Deposit
The landlord must provide the tenant with any security deposit held, minus any deductions for damages or other charges, plus a written itemization of the damages or other charges within 60 days of the termination of the tenancy, or within 45 days of the occupation of the premises by a subsequent tenant, whichever time period is shorter, (WVC § 37-6A-2 (a)); (WVC § 37-6A-1 (7)).
- Delivery: A landlord should deliver a tenant’s security deposit and/or any notice by either personal delivery to the tenant, or by mailing the deposit and/or notice to the tenant’s last known address or forwarding address provided by the tenant. The tenant is responsible for providing the landlord with an accurate address.
- If the delivery of a tenant’s deposit or notice is not reasonably possible, or if mailed deposit or notice is returned as non-deliverable, the landlord can hold the deposit or notice for six months, to be personally delivered to the tenant, or his or her authorized agent or attorney, at the landlord’s place of business during normal business hours, within 72 hours after a written request is received from the tenant (WVC § 37-6A-2 (g)).
Landlords can keep all, or a portion of a tenant’s security deposit to cover only the following deductions (WVC § 37-6A-2 (b)):
- Rent due, including reasonable late fee as specified in the rental agreement
- Damages, not including reasonable wear and tear
- Unpaid utilities that are the obligation of the tenant under the rental agreement, that were billed to and paid by the landlord
- Reasonable costs for the removal and storage of the tenant’s personal property
- Other damages or charges established in the rental agreement
Damages Exceed Security Deposit
If damages to the rental unit exceed the amount of the security deposit held by the landlord and require the services of a third party contractor, the landlord must give the tenant written notice) within the applicable notice period (60 days /45 days), informing him/her of that fact, within the appropriate notice period. If the landlord gives notice as required, he/she has an additional 15-day period to provide an itemization of the damages and the cost of repair (WVC § 37-6A-2 (c));(WVC § 37-6A-1 (7)).
Deposit Credited Against Delinquent Rent
A court of law or otherwise cannot construe that a tenant is entitled to an immediate credit against his/her delinquent rent account in the amount of the security deposit at the time of tenancy termination (WVC § 37-6A-2 (d)).
If a landlord fails to comply with any provision of the security deposit law in a manner that is willful or not in good faith, the tenant is entitled to (WVC § 37-6A-5(a)):
- The amount of any unreturned security deposit
- Damages for annoyance or inconvenience equal to one and a half times the amount wrongfully withheld, unless the tenant owes rent to the landlord, then any amount awarded to the tenant would be credited against any rent the landlord is owed
Still, neither landlord or tenant is limited in the rights or remedies available that they can pursue in the event of noncompliance with legal obligations (WVC § 37-6A-5(c)).
If the tenant has any assignee or sublessee, the landlord can hold a security deposit from only one party in compliance with the security deposit provisions (WVC § 37-6A-2 (f)).
Last Month’s Rent
A security deposit is not intended to be used to cover a tenant’s last month’s rent. However, a landlord and tenant can agree in writing for the security deposit to be used as last month’s rent.
How to Get a Full Refund of Security Deposit
At the end of the tenancy, a full security deposit can be returned to the tenant if there is no damage to the rental property, rent is paid in full, all charges in the rental agreement are covered.
The landlord is required to maintain and itemize records for one year after the termination of the tenancy, for each tenant of all deductions from security deposits, which he/she has made, resulting from a tenant’s noncompliance with the rental agreement. A landlord can allow either a tenant, or his or her authorized agent or attorney to inspect the tenant’s records of deductions at any time during normal business hours within seventy-two hours of a written request. The landlord also has the option of providing a tenant, or his or her authorized agent or attorney a copy of the tenant’s record of deductions during normal business hours within 72 hours of a written request (WVC § 37-6A-3).
Prohibited Provision in Rental Agreement
A rental agreement must not contain a provision that the tenant agrees to waive or forego rights or remedies established under the security deposit law. A provision prohibited that is included in a rental agreement is unenforceable. If a landlord tries to enforce any of the prohibited provisions, the tenant may recover actual damages and reasonable attorney’s fees (WVC § 37-6A-4).
Security Deposits and Tax Filing
What happens to the deposit at the end of the tenancy determines how it is treated for tax purposes.
- Accounting for Security Deposits: Security deposits are treated as either assets or liabilities when filing taxes. Tenants shouldn’t deduct security deposits as expenses and landlords shouldn’t declare them as income when in escrow intended to be returned to the tenant.
- Security Deposit Write-off: If a landlord withholds part or all of the security deposit for losses, that amount should be included as income when filing taxes. Forfeited deposits should be declared as income.
“Normal Wear and Tear” vs. Damage
- “Normal wear and tear” is deterioration that occurs as a result of everyday use of the rental unit, and without negligence, carelessness, accident, or misuse or abuse by the tenant.
- “Damage” refers to destruction to the rental unit that occurs because of abuse or negligence by a tenant during the course of the tenancy and can affect usefulness, value, normal function of the rental unit.
Change of Ownership
The new landlord is required to return any security deposit received by the original landlord that is owed to the tenant. This provision applies whether or not the security deposit is transferred with the landlord’s interest by law or equity, and regardless of any contractual agreements between the original landlord and the new landlord, of this subsection apply (WVC § 37-6A-2(e)).
Tips for West Virginia Landlords on the Right Practices for Security Deposits
- Charge tenants a security deposit amount that is appropriate in the absence of a statutory limit
- Provide tenants with an itemized list of deductions and the cost of each
- Return security deposits within within 60 days of the termination of the tenancy, or within 45 days of the occupation of the premise by a subsequent tenant, whichever time period is shorter
- Seek damages in legal proceedings if a tenant breaches rental agreement and you need to recover damages
Landlords and tenants should know how West Virginia’ security deposit law governs the landlord-tenant relationship. Landlords have an obligation to remain in compliance with the state’s security deposit law. Tenants should adhere to their lease agreement for the period of their tenancy. To learn more about West Virginia statutes on security deposits see WV Code § 37-6A-1 to WV Code § 37-6A-6.