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California security deposit law comes down to four rules, all packed into Civil Code § 1950.5, a section the Legislature has rewritten three times since 2023:
- The cap: one month’s rent, furnished or unfurnished, for deposits collected on or after July 1, 2024
- The deadline: 21 calendar days after move-out, with an itemized statement and receipts for deductions over $125
- The evidence: photographs of the unit before and after any repair or cleaning the landlord deducts for
- The penalty: bad faith retention of a security deposit in California can cost the landlord up to twice the deposit in statutory damages, on top of actual damages
Every figure in this guide is checked against the statute as it reads today, including the amendments that took effect January 1, 2026. Plenty of older articles still quote a two or three month cap that died in 2024. To see how California compares with other states, start with our guide to landlord-tenant laws by state.
How Much Can a Landlord Collect for a Security Deposit in California?
One month’s rent. AB 12 rewrote the cap effective July 1, 2024: a landlord may not demand or receive security in excess of one month’s rent, in addition to the first month’s rent, whether the home comes furnished or not (Civ. Code § 1950.5(c)). The old limits of two months for unfurnished homes and three for furnished ones are gone.
The label on the money makes no difference. The statute caps security “however denominated,” so pet deposits, key money, cleaning deposits, and last month’s rent collected up front all count toward the same one-month ceiling. No part of it can be called nonrefundable either, no matter what the lease says.
One exception survives. A small landlord who is a natural person, or an LLC made up entirely of natural persons, and who owns no more than two residential rental properties with four total units, may collect up to two months’ rent. Even that landlord cannot take the higher amount from an active-duty service member, and cannot refuse to rent to a service member because of that limit. Separately, a landlord may accept six or more months of rent in advance, but only on a lease of six months or longer.
What Can a Security Deposit Be Used For in California?
Four things, and nothing else (§ 1950.5(b)):
- unpaid rent
- repairing damage caused by you or your guests, beyond ordinary wear and tear
- cleaning needed to return the unit to the level of cleanliness it had when you moved in
- restoring or replacing the landlord’s personal property, such as keys or window coverings, when the lease allows it
The statute polices the other direction just as firmly. A landlord cannot charge the deposit for ordinary wear and tear, for the cumulative effect of years of ordinary living, or for conditions that existed before you moved in. Every deduction has to be reasonable and necessary to restore the home’s move-in condition. Faded paint and carpet worn thin by everyday use stay on the landlord’s side of the ledger. Our guide to normal wear and tear in a rental draws that line item by item, and what a landlord cannot do in California covers the rest of the state’s rulebook.
When Must a Security Deposit Be Returned in California?
Within 21 calendar days of move-out. The landlord must return the deposit, minus lawful deductions, along with an itemized statement showing what was withheld and why. Once deductions for repairs and cleaning pass $125, copies of receipts and invoices must come with the statement, and when landlords do the work themselves, the statement has to describe the work, the hours spent, and a reasonable hourly rate. A repair that genuinely cannot be finished inside 21 days allows a good-faith estimate instead, with the real receipts due within 14 days of completing the work.
Give a forwarding address in writing before you hand back the keys. The statement goes to the address you provide. If you never provide one, the law lets the landlord mail everything to the empty unit you just left.
The mechanics changed on January 1, 2026. Under AB 414, if you paid your rent or deposit electronically, the refund must come back electronically too, unless both sides put a different method in writing. You can also agree in writing to receive the itemized statement by email. Roommates should know one quirk: the default refund is a single check payable to every adult on the lease, so if you want it split or sent to one person, all of you must agree in writing.
What Inspection and Photo Rights Do You Have at Move-Out?
Two strong ones, and the photo rules are new.
First, the initial inspection. When a tenancy is ending, the landlord must tell you in writing that you can request a pre-move-out inspection. If you ask for it, the inspection happens no earlier than two weeks before the tenancy ends, on 48 hours’ written notice of the date and time, and the landlord must leave you an itemized statement of the deductions they intend to make. Treat that statement as your repair punch list. Fix what you reasonably can before you leave, because with narrow exceptions the landlord cannot later deduct for problems the inspection could have caught but the statement never listed.
Second, photographs. AB 2801 wrote a photo trail into the statute. Since April 1, 2025, a landlord who deducts for repairs or cleaning must photograph the unit after getting possession back but before any work begins, and again once the work is done. Tenancies that began on or after July 1, 2025 must also be photographed at move-in. Those photographs travel with the itemized statement, alongside a written explanation of the costs.
Take your own dated photos anyway, at move-in and move-out. Deposit disputes are won with evidence, and yours should be at least as thorough as the landlord’s. More habits like this are in our renter’s guide.
What Does Bad Faith Retention of a Security Deposit Cost a Landlord?
Up to twice the deposit in statutory damages, plus actual damages. Section 1950.5 says the bad faith claim or retention of a deposit, or any portion of it, “may subject the landlord… to statutory damages of up to twice the amount of the security, in addition to actual damages.” On a $2,500 deposit kept in bad faith, that is the $2,500 back, any provable losses, and up to $5,000 more.
The statute never defines bad faith, so the judge decides. A late statement or an honest math error usually will not qualify on its own. The fact patterns that draw the penalty are uglier: no itemized statement at all, charges for damage that existed at move-in, deductions with no receipts or photos behind them, or silence after a written request for the money.
Collecting runs through small claims court, which is built for people without lawyers. Start with a demand letter. The California courts’ security deposit guide walks through both the letter and the filing, and residents can sue for up to $12,500 in small claims. Bring your lease, your photos, the itemized statement or proof there never was one, and a copy of your demand letter. These cases are decided on paper trails.
Do California Landlords Have to Pay Interest on Security Deposits?
Not under state law. Section 1950.5 says nothing about interest, and no statewide rule requires the deposit to sit in a separate or interest-bearing account. The money simply remains the resident’s property, held until the tenancy ends.
Cities fill the gap. San Francisco requires annual interest on deposits held longer than a year under Chapter 49 of its Administrative Code, at a rate the Rent Board publishes each year. Los Angeles requires annual interest on deposits for rent-stabilized units under its Rent Stabilization Ordinance, paid directly or credited against rent. Several other rent-control cities run their own versions. If you rent in one of them, check the local rule, because the local rule is the one that pays you.
How Do California Landlords Stay Out of Deposit Trouble?
Treat the deposit as the resident’s money on loan, because that is exactly how the statute treats it. Since the 2025 photo rules, a deduction without pictures is close to indefensible, and a bad-faith finding doubles the exposure. The habits that hold up:
- Photograph on schedule. Move-in photos for tenancies starting on or after July 1, 2025, plus pre-repair and post-repair photos at every move-out where you deduct. Store them with dates.
- Calendar the 21 days the moment keys come back, and the 14-day follow-up whenever you deduct from an estimate.
- Offer the initial inspection in writing every time a tenancy ends. The punch list it produces heads off most disputes before they form.
- Deduct only what you can show a judge. Receipts, invoices, hourly breakdowns for your own labor, and nothing for ordinary wear and tear.
Good paperwork upstream makes move-outs quieter downstream. Our guide to rental applications in California covers what you can lawfully collect and screen for, and how to manage a rental property covers systems for exactly this kind of deadline work. If you would rather hand the photo trail, the deadlines, and the disputes to someone whose full-time job it is, here is what property managers charge in California and how our Los Angeles property management team runs move-outs day to day.
FAQ
What is the maximum security deposit a landlord can charge in California?
One month’s rent, furnished or unfurnished, for deposits collected on or after July 1, 2024, and every dollar held as security counts toward the cap regardless of its label. Small landlords who are natural persons (or all-natural-person LLCs) with no more than two rental properties and four total units may charge up to two months, though never to an active-duty service member.
How long does a landlord have to return a security deposit in California?
21 calendar days from move-out, with an itemized statement of deductions. Receipts and invoices are required once repair and cleaning deductions exceed $125, and since 2026 the refund must be electronic if you paid electronically, unless you agreed to another method in writing.
What counts as bad faith retention of a security deposit in California?
Keeping deposit money the landlord has no honest claim to. Judges decide case by case, and the classic patterns are withholding without an itemized statement, charging for pre-existing damage or ordinary wear and tear, or ignoring a written demand. A bad faith finding costs the landlord up to twice the deposit in statutory damages on top of returning the money and covering actual damages.
Can a landlord deduct for cleaning or repainting in California?
Only to return the unit to the level of cleanliness it had at move-in, and only in a reasonable amount. Ordinary wear and tear, including faded paint and normal carpet wear, can never be deducted, whether it built up over one year or ten.
Can any part of a security deposit be non-refundable in California?
No. Civil Code § 1950.5 bars leases from labeling any security nonrefundable, no matter what the lease calls it. If the money secures the landlord against unpaid rent, damage, or cleaning, it is a refundable deposit under the statute.
This article is general information, not legal advice. Laws change, and every situation is different. For guidance on a specific situation, talk to a California-licensed attorney.
