Security Deposit Law
What Texas 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 10, 2026
This page is general information, not legal advice. Statutes change — verify with the cited sources or an attorney.
Deposit cap
No statutory cap.
Interest
No interest owed on deposits.
Return deadline
Refund (or itemized accounting) within 30 days after the tenant surrenders the premises.
Texas Property Code Chapter 92, Subchapter C sets no maximum on residential security deposits, so landlords may charge what the market will bear. The subchapter applies to all residential leases.
Nothing in Subchapter C requires a Texas landlord to pay or accrue interest on a residential security deposit.
The clock runs from surrender, and the duty to refund or itemize is deferred until the tenant gives a written forwarding address — but the tenant never forfeits the deposit by failing to give one. A mailed refund or accounting postmarked by day 30 counts as timely.
Tex. Prop. Code § 92.103(a) · Tex. Prop. Code § 92.107 · Tex. Prop. Code § 92.1041
Texas does not require deposits to be held in a separate or escrow account; the only statutory duty is to keep accurate records of all security deposits. The tenant's claim to the deposit does take priority over the landlord's creditors, including a bankruptcy trustee.
A landlord who in bad faith retains a deposit owes $100 plus three times the portion wrongfully withheld plus reasonable attorney's fees. Bad-faith failure to provide the itemized list forfeits the right to withhold anything or to sue the tenant for property damage. In any tenant suit, the landlord bears the burden of proving the retention was reasonable.
No city or county security-deposit ordinance overlays identified; Texas Property Code Chapter 92, Subchapter C applies uniformly statewide to all residential leases (§ 92.101).
You may deduct damages and charges the tenant is legally liable for under the lease or for breaching it, but never any portion to cover normal wear and tear.
If you keep any part of the deposit you must return the balance with a written description and itemized list of all deductions. The only exception: the tenant owes rent at surrender and there is no dispute about the amount.
A lease clause requiring the tenant to give advance notice of surrender as a condition of refunding the deposit is enforceable only if it is underlined or in conspicuous bold print.
A tenant who withholds last month's rent on the theory that the deposit covers it is presumed to act in bad faith and owes three times the rent withheld plus your attorney's fees.
If you offer a monthly fee instead of a deposit, you must also offer a traditional deposit option, give specific written disclosures, sign a written agreement, and follow 30-day notice rules before filing insurance claims; you may not charge for normal wear and tear.
Deposit-related notices may be sent by e-mail if landlord and tenant have previously communicated by e-mail, and managing/leasing agents and resident managers count as the landlord's agent for notices.
You are presumed to have acted in bad faith, exposing you to $100 + 3x the amount withheld + the tenant's attorney's fees.
Those deductions are unlawful and count toward a bad-faith retention claim with treble damages.
Bad-faith failure to itemize forfeits your right to withhold ANY portion of the deposit or to sue the tenant for damage to the unit, and you owe the tenant's attorney's fees.
The deadline is deferred until the tenant gives a written forwarding address, but the tenant never loses the right to the refund or the itemization — keep the money ready and records intact.
The condition is void unless underlined or in conspicuous bold print, so you cannot rely on it to keep the deposit.
30 days from the date the tenant surrenders the premises. Mailing the refund or itemized accounting with a postmark on or before day 30 counts as timely under § 92.1041. Miss the deadline and you are presumed to have acted in bad faith.
No. § 92.104(b) flatly prohibits retaining any portion of the deposit for normal wear and tear. You may deduct only damages and charges the tenant is legally liable for under the lease or from breaching it — and you must itemize them in writing.
No. Texas law sets no cap on residential security deposits and requires no interest on them. Market norms (typically one month's rent) are a business decision, not a legal ceiling.
Failing to refund or itemize by day 30 creates a legal presumption of bad faith. A bad-faith landlord owes the tenant $100 plus three times the amount wrongfully withheld plus reasonable attorney's fees, and bears the burden of proving any retention was reasonable.
Not yet — the obligation to refund or itemize doesn't kick in until the tenant gives a written forwarding address. But the tenant never forfeits the deposit by failing to provide one, so hold the funds and your records until they do.
No. § 92.108 prohibits it, presumes a tenant who tries acted in bad faith, and makes the tenant liable for three times the rent withheld plus your reasonable attorney's fees.
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 10, 2026.
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