Overview
California security deposit laws are among the most detailed in the country, offering tenants strong protections while also setting clear expectations for landlords. These rules cover how deposits must be collected, handled, and returned.
Under California Civil Code § 1950.5, landlords must strictly adhere to legal procedures or risk penalties and forfeiture of any withheld amounts.
This guide covers:
How much landlords can charge
Where deposits must be stored
Rules for returning security deposits
Penalties for non-compliance
Related Statute: Cal. Civ. Code § 1950.5
1. Security Deposit Limits & Storage Requirements
Maximum deposit: California law limits security deposits to two months’ rent for unfurnished units and three months’ rent for furnished units.
Storage requirements: There is no requirement for landlords to store deposits in a separate or interest-bearing account.
Tenant notification: While not required to disclose the bank holding the deposit, landlords must maintain proper accounting and provide documentation upon return.
Law Reference: Cal. Civ. Code § 1950.5(c)
2. Security Deposit Returns & Allowable Deductions
Return deadline: Landlords must return the deposit within 21 calendar days of the tenant vacating the unit.
Permissible deductions: Deductions may be made for unpaid rent, damage beyond normal wear and tear, and cleaning costs necessary to return the unit to its original condition.
What landlords cannot deduct: Normal wear and tear such as faded paint, worn carpet, or minor marks may not be deducted.
Itemized statement required: If any portion of the deposit is withheld, a written itemized list of deductions must be provided. For deductions exceeding $125, landlords are required to include copies of invoices or receipts, and as of recent legal updates, landlords must also include photos documenting the condition and reasons for the deductions.
Law Reference: Cal. Civ. Code § 1950.5(g)(2)
3. Interest Payments & Documentation Requirements
Interest payments: Some cities, like San Francisco and Los Angeles, require landlords to pay interest on deposits. State law does not mandate interest.
Move-in condition report: Not required by state law but strongly recommended. Some local ordinances may require it.
Tenant review period: Tenants have the right to request a pre-move-out inspection to identify potential deductions and correct issues before vacating.
Failure to provide documentation: If landlords fail to provide required photos, receipts, or notices, they may forfeit the right to withhold any portion of the deposit.
Law Reference: Cal. Civ. Code § 1950.5(f)-(g)
4. Penalties for Mishandling Security Deposits
California law strictly enforces penalties for mishandling deposits.
Failure to return the deposit within 21 days or to provide complete documentation may result in the landlord being liable for up to twice the amount wrongfully withheld, plus the original deposit.
Failure to include required photos or invoices when deducting over $125 may lead to forfeiture of the withheld amount.
Law Reference: Cal. Civ. Code § 1950.5(l)
Key Takeaways
Deposits are capped at two months’ rent for unfurnished units and three months for furnished units.
Deposits must be returned within 21 days, with detailed itemized deductions.
Photos and receipts must be included for deductions over $125.
Interest is required in some cities, but not under state law.
Non-compliance can lead to triple damages, including the full deposit and twice the amount wrongfully withheld.
By understanding and following California security deposit laws, landlords can avoid costly disputes, and tenants can protect their financial interests during move-out.
Disclaimer: This blog post is intended for informational purposes only and does not constitute legal advice. Readers should not act or refrain from acting based on any information included in this post without seeking legal counsel or other professional guidance specific to their situation. The information is provided “as is” without any representations or warranties of any kind, express or implied, including but not limited to the accuracy, completeness, or reliability of the content. Laws and regulations may change and vary by jurisdiction.
