New York security deposit account for landlords
Easily collect and manage deposits for every property with dedicated security deposit accounts.
Why use a security deposit account in {{ state }}
Security deposit funds are instantly separated, making move-in, move-out, and returns completely clear.
Benefits for property
owners
Repair and maintenance
Covers property damage such as paint, carpet, or floor damage, including costs caused by pets.
Fund separation
Meet state requirements for holding deposits in a dedicated tenant security deposit account.
Streamlined returns
Simplifies refunding tenants while accounting for deductions like cleaning or unpaid utilities.
Benefits for tenants
Fair protection
Funds are protected from misuse, covering only actual repair costs like cleaning, carpet replacement, or floor damage.
Transparency on deductions
Tenants can clearly see allowable charges, protecting against unfair claims on normal wear and tear.
Savings potential
Deposits may be held in a tenant security deposit account or rental deposit account that earns security deposit interest, helping tenants recover more than they put in.
Baselane accounts cannot hold security deposits in states requiring escrow or state-based accounts, but can be used to collect, track, and securely transfer deposits to compliant external accounts.
{{ state }} security deposit account
Each tenant’s security deposit in New York must be held in a trust fund. It must be deposited into a dedicated security deposit bank account in New York at a bank or trust company, and it cannot be mixed with other funds.
{{ state }} security deposit
limits
The maximum security deposit New York landlords can charge is one month’s rent, which is below the average security deposit amount.
{{ state }} security deposit interest
The security deposit rule allows interest on security deposits in New York paid to the tenant annually. The security deposit interest rate is defined by law, and you can deduct 1% for administrative costs from the total interest payment. The tenant can choose how to receive the interest (deducted from rent, held in trust, or paid yearly).
Go beyond standard security deposit accounts
Collect, return, and track deposits by tenant and
property, even when funds are held in external accounts.
{{ state }} security deposit accounts
Keep every deposit organized and accounted for with secure transfers to [State] security deposit accounts.
Unlimited accounts for all entities
Manage deposits for all entities under one login — LLCs, corporations, partnerships, and individuals.
Free online payments
Collect rent and deposits online for free and easily return deposits via ACH, wire, or check.
Automated bookkeeping
Track and tag payments to the right tenant and property — automatically.
Essentials for every door
Everything you need for every part of the rental process.
Lease creation and e-sign
Upload or create and e-sign state-specific leases online.
Free tenant screening
Screen tenants online for free — instantly verify credit, background, evictions, ID, and income.
Property-specific accounts
Open unlimited checking and savings accounts to easily separate funds for all your properties with no monthly maintenance fees.
{{ state }} security deposit rules
1 month’s rent
Hold security deposit in a trust, interest-bearing account with a New York-based bank or trust company.
Unpaid rent, utilities, damages beyond normal wear and tear, and moving and storage of the tenant’s belongings.
14 days
Additional resources
ARTICLE
How to collect security deposits
FAQs
How much security deposit can a landlord charge in New York?
The New York security deposit limit is one month’s rent. This cap means you cannot charge both a security deposit and first and last month's rent, plus the deposit, because that would exceed the one-month limit.
Is interest required on New York landlord security deposits?
Yes, New York security deposit interest is required. You must pay interest earned on the landlord tenant security deposit bank account in New York to tenants annually, after deducting 1% of the admin fees.
How should I issue a security deposit receipt to tenants in New York?
Issuing a security deposit receipt is straightforward. Write a receipt and include the security deposit bank account number, name, and location, and mail it to the tenants. It’s ideal to issue it within 30 days of the lease starting date.
How many days to return the security deposit in New York?
You have 14 days after tenants move out to return the tenant's security deposit in full in New York. If you keep money for damages, overdue rent, or fee payments, send an itemized list with the cost and the remaining deposit amount within those 14 days. If you don’t do this within the timeline, you lose your right to keep any of the deposit.
What can a landlord deduct from a security deposit in New York?
The landlord's rights security deposit New York law allows you to deduct for unpaid rent and damage to the property (house rental, apartment, or condo) that is worse than normal wear and tear (like floor damage or broken equipment). If you wrongfully charge for ordinary wear and tear or skip the detailed list, a court may make you pay the tenant double damages.
Can a security deposit be used for unpaid rent in New York?
Yes, you can keep part of the funds from the security deposit escrow account in New York to cover rent that the tenant owes you at the end of tenancy. Make sure to inform the tenant about these deductions.
Can a landlord keep a security deposit for breaking a lease in New York?
Yes, funds from a landlord's security deposit in New York can be used to cover unpaid rent if a tenant is breaking lease terms (early termination), provided your lease allows this. The tenant is still responsible for rent until you find a new renter.
