Security Deposit Account for Landlords in Illinois
Never chase down checks or late rent payments again. Accept rent by ACH or card. Automated payments, fees & reminders.
- Multiple accounts per property
- No account fees or minimum balances
- 4.19% APY interest and up to 5% cash back†
Benefits of security deposit accounts in Illinois
Landlords
- Provides financial protection for landlords in the event of property damage caused by tenants.
- Allows landlords to recoup losses from unpaid rent or other costs associated with the lease agreement.
- Covers the cost of any repairs that need to be done on the property after a tenant leaves.
- Gives landlords peace of mind that there will be a financial cushion if anything goes wrong during the tenancy period.
Tenants
- Security deposits help protect tenants financially in the event of unexpected damages.
- Give tenants the peace of mind that they will be able to get back their deposit after the end of the lease if nothing is wrong.
- Tenants can use security deposits to cover repairs, maintenance, and cleaning costs at the end of a lease agreement.
- Security deposits are refundable and allow tenants to save money in comparison to having to pay out-of-pocket for unexpected costs or damages.
Security deposit rules in Illinois
- Limit: No legal limit applies
- Return Deadline: The security deposit must be returned within 45 days, or 30 days if you’re taking deductions
- Acceptable Deductions: Unpaid rent (including late fees), unpaid utility bills, cost of cleaning, and damage beyond normal wear and tear
- Where to Deposit: Landlords with 25 units or more must keep security deposits in interest-bearing accounts in Illinois
Why Illinois landlords choose Baselane
Why choose rental security deposit account
- All-in-One Platform with Banking, Rent Collection, and Accounting and more
- Eligible to hold Security Deposits**
- Free Rent Collection that’s landlord and renter friendly
- Earn 4.19% APY and up to 5% Cash Back
- Comprehensive cash flow analytics and reporting
- Modern user interface and experience
- Excellent Customer Support
**NOT LEGAL ADVICE. Please consult with an attorney and/or local city and state laws and requirements.
Take Control of Your Spend
Open a security deposit bank account and use physical & virtual debit cards with custom spend controls and automated transaction tagging with Schedule E categories.
Easily Collect and Return Security Deposits
Collect funds into an account for security deposit via Bank Transfers (ACH payments), Deposit checks, or Wire.
Easy to get started
Open a security deposit bank
account for free
Create a Virtual account
(aka - rental security deposit account)
Collect security deposits
into a virtual account
Frequently asked questions
There is no specific amount set for security deposits in Illinois. However, landlords who own 25 or more units must keep security deposits in interest-bearing accounts and pay interest to tenants, as per the provisions of the 765 ILCS 715/1 and 765 ILCS 715/2. Additionally, landlords must return the security deposit, minus any deductions for damages or unpaid rent, within a reasonable time after the tenant moves out, as defined by the state law.
These are the other states where you can use Baselane: Arizona, California, Illinois, New Jersey, Texas, Virginia & all major states in the USA.
Tenants can cause a lot of damage to your rental property, so you should aim to collect the largest security deposit the market will bear. One month’s rent is typical in most parts of the country, but you may be able to demand more if your rental property is in a particularly hot market.
Your state may set a cap on how much you can collect. Many states, including New York, Massachusetts, and Ohio, set the maximum security deposit you can collect at one month’s rent. Others, including California, Pennsylvania, and Maryland, limit security deposits to 2 months’ rent. There’s no limit on security deposits for rentals in Indiana and Florida.
You should collect the security deposit and the first month’s rent when your new tenant signs the lease. Be sure to give your tenant a detailed receipt for their deposit that includes all information required by local law. Consider using Baselane for automated rent collection to get paid faster, simplify your bookkeeping and ensure you’re handling your deposits appropriately.
If local law states a lower maximum security deposit for month-to-month leases, you may be required to refund the excess amount. Otherwise, the initial terms of the lease usually continue to apply when switching to month-to-month, and no change to the security deposit is required.
You should collect the security deposit and the first month’s rent when your new tenant signs the lease. Be sure to give your tenant a detailed receipt for their deposit that includes all information required by local law. Consider using Baselane for automated rent collection to get paid faster, simplify your bookkeeping and ensure you’re handling your deposits appropriately.
