What Kind of Costs Can I Deduct From My Tenant's Security Deposit?
When you rent out an apartment or a house, you will most likely collect a security deposit to cover repairs and cleaning. This is not to be confused with last month's rent, which legally cannot be used as a security deposit (see The Difference Between Last Month's Rent and a Security Deposit for more details). Normal living always results in some sort of wear, such as scratches on a hardwood floor, but what kind of costs can you deduct from your tenant's deposit? The following information provides a general guideline.
Generally, a landlord may retain all or part of the security deposit to pay for damages to the unit that occurred during the tenants' occupancy, except for those resulting from normal wear and tear. Usually, the landlord can deduct other costs, such as late fees, unpaid rent, and unpaid utility bills. If a tenant does not leave the apartment in a sanitary condition, a landlord may also be entitled to deduct the reasonable costs of any required cleaning.
Normal wear and tear may include (but is not limited to) the following:
- Sun-faded curtains or carpeting
- Minor marks on walls or floors
- Toilet clogged from mineral deposits
It should be noted that landlords typically have a fixed amount of time, often 30 days, to return a tenant's security deposit. Furthermore, a landlord should make a detailed written list of any damages, as well as necessary repairs. This should be provided to the tenant along with receipts or similar written proof of the cost of repairs. It should also be noted that many states provide for enhanced penalties on landlords should a security deposit (or part thereof) be improperly withheld.
See Security Deposit Return Timelines for a state-by-state listing.
If you have additional questions or need representation for a legal action, consider speaking with a real estate attorney specializing in landlord-tenant law.