What can a landlord deduct from the tenants security deposit. Collecting a deposit before a new tenant moves in can bring peace of mind to the owner, but when a tenant moves out, what can you actually deduct from the deposit, and what do you need to do?

The general rule is that you can only withhold deposit monies for actual damages, material or financial.

  1. Always fill out a property conditions checklist before a tenant moves in, to compared to when they move out. That way there is no grey area of whether or not damage was present when the tenant moved in.
  2. Provide tenant with itemized receipt before returning the money. You need to show exactly what’s being deducted from the deposit and why. Invoices, etc help with that.

You can not deduct normal wear and tear, but what exactly is normal wear and tear?

  • General rug wear
  • Sun-faded wallpaper or paint
  • Nail holes in wall from picture hanging
  • Dirty blinds

Basically deterioration that results from the intended use of the dwelling.

Have clear cut standards you hold all tenants too. It makes moving tenants in and out a lot easier than having any special agreements or special treatment. Make expectations known. Tell the tenants exactly what they need to do and how they need to leave the property in order to get their deposit back.