A security deposit return letter is a written document sent by a landlord to a tenant indicating how much, if any, of the original security deposit is being returned at the end of the tenancy, as well as details about any deductions made.
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At the beginning of a residential rental tenancy, the landlord will probably collect a security deposit from you and any other tenants or roommates that are listed on the lease or rental agreement. This security deposit is a one time, refundable deposit that is commonly required by the landlord with the first month’s rent. Security deposits are not required by law and are mainly collected to secure payment for potential damages (property or monetary) the landlord might incur by the tenant(s). The security deposit is held by the landlord during the entire tenancy. When the tenancy concludes, the landlord is required to return the security deposit minus the cost of repairs to the property caused by the tenant(s), unpaid rent, utilities or other property-related fees.
Many states govern how a landlord can collect, handle, and return a rental security deposit. Most states have their own unique laws concerning how long a landlord has to return the security deposit and/or provide their tenant(s) with a reason for keeping any portion of it. Landlords are typically required to return the security deposit between 15 to 45 days of the tenancy concluding. When fulfilling your state requirement, send a security deposit return letter with the deposit. This will provide you and your tenant(s) with documentation of when and how much of the security deposit was returned.
Purpose of a Security Deposit Return Letter
Security deposit return letters are helpful for landlords and tenants alike. Since moving can be stressful—and you might not have time to talk to your tenant prior to the move—the safest way to handle the return of a security deposit is by sending them a security deposit return letter. These letters can be used to return the partial or full security deposit with an explanation of any deductions that have been applied.
Before sending the deposit, you will want to inspect the property and determine if there are any damages to the property that are outside normal wear and tear. Excessive damages or unpaid rent can be deducted from the security deposit. The security deposit return letter should provide a detailed account of all deductions that have been made to the original amount, if applicable. You will want to be fair and reasonable when making a deduction to the security deposit. If you are unable to justify the reason for a deduction, there is a possibility that the tenant(s) could object to them and argue their claim in court.
Tip: If you are a tenant and need to inform your former landlord of your new address (so they know where to send the deposit) you will want to send them a Security Deposit Request Letter.
State Security Deposit Return Laws
Each state has its own unique landlord-tenant laws that regulate how a rental property should be managed. These state-specific laws often include regulations on the collection, handling, and return of security deposits. When a tenancy has terminated, a landlord might be legally required to return the security deposit within a specific amount of time (usually 15-45 days).
Below are the maximum time periods the landlord has to return the deposit to the tenant for each state:
| State | Return within |
| Alabama | 60 days (§ 35-9A-201) |
| Alaska | 14 days (§ 34.03.070) |
| Arizona | 14 days (§ 33-1321) |
| Arkansas | 60 days (§ 18-16-305) |
| California | 21 days (1950.5) |
| Colorado | 1 month (§ 38-12-103) |
| Connecticut | 15 days (§ 47a-21) |
| Delaware | 20 days (Title 25 § 5514) |
| Florida | 15 days (83.49(3)(a)) |
| Georgia | 1 month (§ 44-7-34) |
| Hawaii | 14 days (§ 521-44) |
| Idaho | 21 days (§ 6-321) |
| Illinois | 30 days (765 ILCS 710) |
| Indiana | 45 days (§ 32-31-3-12) |
| Iowa | 30 days (§562A.12(3)(a)) |
| Kansas | 30 days (§ 58-2550(b)) |
| Kentucky | 60 days (§ 383.580) |
| Louisiana | 1 month (§ 9:3251) |
| Maine | 21 or 30 days (§ 6033) |
| Maryland | 45 days (§ 8–203) |
| Massachusetts | 30 days (186, § 15B) |
| Michigan | 30 days (§ 554.609) |
| Minnesota | 3 weeks (504B.178) |
| Mississippi | 45 days (§ 89-8-21) |
| Missouri | 30 days (§ 535.300) |
| Montana | 10 days (§ 70-25-202) |
| Nebraska | 14 days (§ 76-1416) |
| Nevada | 30 days (NRS 118A.242) |
| New Hampshire | 30 days (RSA 540-A:7) |
| New Jersey | 30 days (§ 46:8-21.1) |
| New Mexico | 30 days ((§ 47-8-24) |
| New York | Reasonable Time (Source) |
| North Carolina | 30 days (§ 42-52) |
| North Dakota | 30 days (§ 47-16-07.1) |
| Ohio | 30 days (§ 5321.16) |
| Oklahoma | 30 days (§ 41-115) |
| Oregon | 31 days (§ 90.300) |
| Pennsylvania | 30 days (§ 250.512) |
| Rhode Island | 20 days (§ 34-18-19) |
| South Carolina | 30 days (§ 27-40-410) |
| South Dakota | 14 days (§ 43-32-24) |
| Tennessee | 30 days (§ 66-28-301) |
| Texas | 30 days (§ 92.103) |
| Utah | 30 days (§ 57-17-3) |
| Vermont | 14 days (§ 4461) |
| Virginia | 45 days (§ 55-248.15:1) |
| Washington | 14 days (§ 59.18.280) |
| Washington, DC | 45 days (14 DCMR § 309.1) |
| West Virginia | 45 days (§ 37-6A-1) |
| Wisconsin | 21 days (§ 134.06) |
| Wyoming | 30 days (§ 1-21-1208(A)) |
Despite state law, the landlord is obligated to return the security deposit minus any damages or non-payment of rent and other fees to the tenant in a timely manner.
Types of Security Deposit Deductions
Consider a security deposit as a type of insurance for the landlord—it can protect them against any damages or lease violations by their tenants. However, when the tenancy concludes, the landlord is legally required to return the deposit. Landlords are not allowed to keep a security deposit (or a portion of it) because they want to. Typically, landlords can only deduct or keep the entire security deposit for the following reasons:
Unpaid rent, property fees, or utility bills
If a tenant fails to pay rent, the landlord is entitled to keep all or part of the security deposit to cover the lost amount of rent. Tenants who do not pay rent are in violation of their lease or rental agreement—since the tenant has not met their payment obligation as stated in their agreement. In addition to unpaid rent, the landlord can also deduct unpaid utility bills or other property associated fees from the security deposit if the tenant neglects to settle them prior to moving.
Cleaning Costs
Landlords can deduct a cleaning fee from their tenant’s security deposit as long as it is within reason. The general rule of thumb is that the property should be returned to the landlord in the same condition as when the tenancy began. There are landlords who can be heavy-handed on cleaning fees. Tenants should not be charged for typical house cleaning fees. Cleaning security deposit deductions should only be used when the property needs excessive cleaning.
For example, if the tenant had a pet in the rental, and the pet often relieved itself on the carpet, the landlord could charge the tenant with a carpet cleaning (or replacement) fee. However, if the tenant moves out and leaves a few items in the refrigerator, the landlord should not charge the tenant with a cleaning fee.
Failure to restore, replace, or return personal property
Landlords are entitled to deduct from the security deposit to get their property back to its original condition. However, landlords should not charge their tenant(s) with repairs they authorized. The amount deducted to restore, replace or return personal property should reflect their fair market value.
For example, if a tenant paints the walls a different color, they can be charged to have the walls repainted back to their original color.
Landlords can charge for the repair of any damages to the property the tenant (or their guest) caused. But, like with cleaning fees, the landlord will need to distinguish the difference between damages and normal wear and tear. Here are examples of each:
| Wear and tear | Damage |
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Breaking or terminating a lease before its expiration
If a tenant breaks their lease early, the landlord is entitled to keep all or part of the security deposit to cover any of the costs associated with the breach. By terminating a lease before it expires violates the rental agreement—since the tenant has not met their obligation as stated in the agreement. Since all leases (and rental agreements) are written differently, you will want to check the wording of the agreement and your state tenant-landlord laws. If an early termination clause is allowed for in the agreement, then the landlord would not be allowed to keep the deposit (for this purpose).
If you find a reason to keep any portion of a tenant’s security deposit, make sure there is a legal reason for keeping it. You will want to document the issue and provide the tenant with an explanation for each deduction that is made. Keep in mind, all of this will need to be completed within your state’s established timeframe.
For example, if the security deposit was for $900 and you identify $600 worth of property damage (or unpaid rent), you would be required to return the remaining $300 with an explanation of why you retained $600. If you live in the state of Alabama, you would have 60 days to complete the aforementioned.
Before you move, document the condition of the property with photos (or video). This can help protect you from any unfounded claims of damage by your landlord.
Refunding A Security Deposit
A. If there are no deductions. Refunding a security deposit in its entirety (and interest if applicable) is a straightforward matter. To comply with state laws, the landlord will need to return the security deposit to the tenant within their state’s established timeframe. This security deposit return letter should contain the following:
- Name and new address of the tenant(s), or the address provided for the return of the deposit
- The start date and end date of the lease
- The amount of the security deposit given by the tenant when they moved in
- The amount of interest accrued (if applicable)
- A check for the amount owed to the tenant
- The signature of the landlord and the date of signing
Once this letter has been written and given to the tenant, there are no further necessary steps for the landlord to make.
B. If there are deductions. When preparing a security deposit return letter that has deductions, the landlord should itemize any damages or deductions to the deposit in a financial statement and include it with the security deposit. Here are the key components to include when writing a security deposit return letter:
- Name and new address of the tenant(s), or the address provided for the return of the deposit
- The start date and end date of the lease
- The amount of the security deposit given by the tenant when they moved in
- The amount of interest accrued (if applicable)
- A financial statement that contains any legitimate deductions (cleaning costs, damages, repairs, unpaid rent, late fees, unpaid utilities, and other expenses)
- A brief explanation for each deduction (if applicable)
- Copies of repair or cleaning bills (if applicable)
- The total amount of deductions (if applicable)
- A check for the amount owed to the tenant or a request from the tenant to pay the amount due, including the date by which the payment should be made
- The signature of the landlord and the date of signing
To make sure that you are completing the letter correctly, check your state laws for compliance with the local requirements.
