Understanding Security Deposit Laws by State

By PropsManager Team | Dec 17, 2025

Understanding Security Deposit Laws by State

Mishandling security deposits is one of the most common reasons landlords get sued. Laws vary significantly by state, but here are the key areas you need to research for your location.

1. Maximum Amount

• California: 1 month's rent for unfurnished, 2 months for furnished (recent changes may apply).
• New York: 1 month's rent limit.
• Texas: No statutory limit.

2. Deadline to Return

You have a specific window to return the deposit or an itemized list of deductions after the tenant moves out.

• 14 Days: Arizona, Hawaii, Vermont, Washington.
• 21 Days: California, Idaho.
• 30 Days: Most states (e.g., Texas, Colorado, Pennsylvania).

3. Allowable Deductions

Generally, you can deduct for:

• Unpaid rent.
• Damage beyond "normal wear and tear."
• Cleaning costs to restore the unit to move-in condition.

You cannot deduct for:

• Faded paint or carpet worn from normal use.
• Pre-existing damage.

Conclusion

Always keep security deposits in a separate bank account (required in many states). Use PropsManager to track deposits and generate itemized deduction reports to ensure you stay compliant.