When Can You Deduct from a Security Deposit?

When do you deduct from a tenant's security deposit?

Image from Flickr via quaziefoto

Security deposits, or damage deposits, are one of the most common tenant complaints, which is understandable since deductions can involve quite a large chunk of money. As touchy as the subject is, it can’t be avoided, especially when there’s a need for repairs as a result of damages made by the tenant. In order to make the process as quick and painless as possible, have a good understanding of the security deposit laws in your state. Avoid landlord-tenant disputes by clearly outlining for your tenants exactly which damages can and cannot result in deduction.

What can I deduct from the security deposit?

The purpose of a security deposit is to protect you, the property manager, from getting left behind with a mess on your hands when your tenant moves out. By “mess,” though, we mean excessive damage and dirtiness – it is illegal in most states to charge for the normal wear-and-tear that occurs on a property due to everyday use. Prevent unfair deductions and avoid causing unnecessary disputes by clarifying exactly what will result in a deduction.

Here are the items considered to be the result of normal wear-and-tear. Under security deposit laws, you cannot deduct for these damages.

  • Faded curtains, carpet, wallpaper or paint due to age or sunlight
  • Warped doors and windows caused by moisture, temperature or age.
  • Wear on rugs from normal use
  • Broken plumbing as a result of daily use.
  • Broken appliances that are not the result of misuse
  • Replacement of batteries or bulbs for lights and smoke detectors

Here are examples of the situations where you can deduct from the security deposit for damages beyond what’s caused by normal wear-and-tear.

  • Stains on the carpet or curtains, such as those caused by smoke, pet urine or paint
  • Broken doors and windows – this can include torn, broken or missing screens, blinds, locks and handles.
  • Extermination of fleas or pests
  • Cleaning of excessive filth, mildew or mold in the bathroom.
  • Clogged drains and toilets due to misuse
  • Broken appliances, plumbing or fixtures that are the result of misuse.
  • Broken walls and tiles, including excessive holes in the wall from photo frames.

Not a physical damage, but still very important: non-payment of rent

Remember that if you need to deduct any amount from the security deposit, you need to notify the tenant exactly which items were damaged or repaired. In some states, you can get sued for deducting from a security deposit with no explanation to the tenant, so steer clear of legal trouble by providing your renter with a copy of the receipt.

Look up the security deposit laws in your state and make them available to your tenants. Give them a list of damages that are and are not covered by their security deposit, and offer to inspect the unit a few weeks before they move out so that they have the opportunity to repair some of the damage themselves. This can save you the time and effort of calling your own repairmen and dealing with an unsatisfied tenant.

Disclaimer: We’ve provided you with a list of general damages that are deducted from a security deposit. There are security deposit laws specific to each state, so you should definitely check the rules and regulations in your state for accuracy.