Security Deposit Law
What Connecticut landlords must do with security deposits — the cap, interest, return deadline, account rules, and penalties — with citations to the statute itself.
Verified as of June 11, 2026
This page is general information, not legal advice. Statutes change — verify with the cited sources or an attorney.
Deposit cap
Maximum two months' rent; one month's rent if the tenant is 62 or older.
Interest
Yes — annual interest at no less than the Banking Commissioner's deposit index (0.49% for 2026), paid or credited each year on the tenancy anniversary.
Return deadline
Within 21 days after the tenancy ends, or 15 days after receiving the tenant's written forwarding address, whichever is later.
A landlord may not demand a security deposit exceeding two months' rent from a tenant under 62, or one month's rent from a tenant 62 or older. If a tenant turns 62 after paying a larger deposit, the landlord must refund the portion above one month's rent on the tenant's request.
Landlords must pay interest on each deposit at a rate not less than the deposit index defined in Conn. Gen. Stat. § 36a-26 for that calendar year; the Department of Banking lists the 2026 rate as 0.49%. Interest must be paid to the tenant or credited toward rent on the tenancy anniversary each year, and accrued interest must be paid within 21 days of termination (or early return of the deposit). A tenant forfeits interest for any month rent was more than ten days late, unless the lease imposes a late charge, and landlords may not raise rent to offset the interest obligation.
Conn. Gen. Stat. § 47a-21(i) · Conn. Dept. of Banking, Rental Security Deposits
The landlord must deliver either the full deposit plus accrued interest, or the balance after deductions for the tenant's failure to comply with the tenant's obligations together with a written statement itemizing the nature and amount of each damage. The 21-day window (reduced from 30 by P.A. 23-207, 2023) also governs paying out accrued interest at termination.
Every deposit must be immediately placed in an escrow account at a financial institution located in Connecticut, held by the landlord as escrow agent for the tenant's benefit, exempt from the landlord's creditors, with withdrawals allowed only for statutorily listed purposes. Within 30 days of receiving or transferring a deposit, the landlord must give the tenant written notice of the amount held and the name and address of the financial institution.
Violating the return rules makes the landlord liable for twice the deposit (if the only violation is unpaid accrued interest, liability is $10 or twice the accrued interest, whichever is greater). Knowing and wilful violations also carry fines: up to $250 per offense for failing to pay a deposit when due (good-faith damage claims are an affirmative defense), up to $500 and/or 30 days in jail per escrow violation (affirmative defense for landlords with fewer than four deposit-paying tenants), and up to $100 per missed interest payment. The Banking Commissioner can investigate complaints and issue cease-and-desist orders.
None identified. Connecticut regulates security deposits statewide through Conn. Gen. Stat. § 47a-21 and Banking Commissioner oversight; no municipal security deposit ordinances were found for Connecticut cities.
The two-month cap applies only to tenants under 62. For tenants 62 or older the cap is one month's rent, and if an existing tenant turns 62, you must refund the excess above one month's rent upon request.
Deposits must go immediately into an escrow account at a Connecticut-located financial institution, remain the tenant's property, and stay shielded from the landlord's creditors. The tenant must receive written notice of the amount held and the institution's name and address within 30 days of receipt or transfer of the deposit.
Interest accrues at no less than the deposit index for each calendar year (0.49% for 2026, published by the Department of Banking) and must be paid or credited toward rent on each tenancy anniversary. You may keep escrow earnings above what the tenant is owed.
Conn. Gen. Stat. § 47a-21(i), (h)(2)(D) · Conn. Dept. of Banking, Rental Security Deposits
P.A. 23-207 (2023) cut the return window from 30 to 21 days after termination — or 15 days after receiving the tenant's written forwarding address, whichever is later — for both the deposit balance and accrued interest. Deductions are limited to the tenant's obligations (unpaid rent/utilities, § 47a-11 obligations, and unpaid lock-change costs under § 47a-7b) and require an itemized written statement.
Conn. Gen. Stat. § 47a-21(d)(2), (a)(14); P.A. 23-207, §§ 38, 39
Any transfer of the property automatically assigns the deposits to the successor, the seller must withdraw and deliver the full deposits plus accrued interest to the buyer, and the successor becomes liable to tenants for deposit claims arising while it is the landlord.
A landlord who is not a Connecticut resident must appoint, in writing, the Secretary of the State as agent for service of process in any action against the landlord.
Since October 1, 2023 (P.A. 23-207) the deadline is 21 days after termination (or 15 days after receiving the forwarding address, if later); blowing it makes the landlord liable for twice the deposit.
Knowing and wilful escrow violations are punishable by a fine of up to $500 and/or up to 30 days' imprisonment per offense (with an affirmative defense for landlords with fewer than four deposit-paying tenants), and the Banking Commissioner can investigate and issue cease-and-desist orders.
Interest must be paid or credited each year on the tenancy anniversary and within 21 days of termination; if the only violation is the unpaid interest, liability is $10 or twice the accrued interest (whichever is greater), plus a fine of up to $100 per wilful offense.
Even a legitimate damage claim does not excuse the deadline — failure to deliver the balance together with a written statement itemizing the nature and amount of damages within the 21/15-day window triggers liability for twice the deposit; Connecticut courts only ask whether the landlord complied with the statutory requirements.
The transfer automatically assigns deposits to the successor, the seller must withdraw and deliver the entire amount plus accrued interest, and the successor is liable to tenants for deposit returns that come due while it is landlord — so both sides need this handled at closing.
Up to two months' rent for tenants under 62, and up to one month's rent for tenants 62 or older. If a current tenant turns 62, you must refund anything above one month's rent when they ask. Note that 'security deposit' includes any advance rental payment other than first month's rent or a key/equipment deposit — so last month's rent collected up front counts against the cap and earns interest.
Within 21 days after the tenancy ends, or within 15 days after receiving the tenant's written forwarding address, whichever is later. You must send either the full deposit plus accrued interest, or the balance plus an itemized written statement of damages. The deadline was shortened from 30 to 21 days effective October 1, 2023 (P.A. 23-207).
At least the 'deposit index' set under Conn. Gen. Stat. § 36a-26 for each calendar year — 0.49% for 2026 per the Department of Banking. Interest must be paid to the tenant or credited toward rent every year on the tenancy anniversary, and any accrued interest must be paid within 21 days of move-out.
Yes. Every deposit must go immediately into an escrow account at a financial institution located in Connecticut, held for the tenant's benefit and protected from the landlord's creditors. You must also give the tenant written notice of the amount held and the bank's name and address within 30 days of receiving the deposit. Wilful violations carry up to a $500 fine and/or 30 days in jail per offense.
Liability for twice the amount of the deposit if you miss the 21/15-day deadline or skip the itemized statement — and courts apply this based purely on statutory compliance, not whether your damage claim was justified. There is also a fine of up to $250 per offense for knowingly and wilfully failing to pay a deposit when due, though a good-faith damage claim is an affirmative defense to the fine.
Partially. Interest is not owed for any month in which the tenant was more than ten days delinquent on rent — but only if you did not charge a late fee for that delinquency. If your lease imposes a late charge, the tenant keeps the interest. You also cannot raise the rent to offset your interest obligation.
This page is general information, not legal advice. Statutes change — verify with the cited sources or an attorney.
Statute facts on this page were verified against the cited official sources on June 11, 2026.
Tenvale tracks deposits, interest, and deadlines for you — free for 30 days, no credit card required.
See full pricing and other states.