Texas 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.
{{ state }} security deposit account
State law doesn’t mandate the use of an escrow account to hold security deposit funds. However, keeping an accurate record of tenant security deposits in Texas is mandated, which is why you should consider using a separate savings or checking security deposit bank account in Texas. It ensures the money is available for a timely refund and simplifies your year-end accounting.
{{ state }} security deposit
limits
Under the 2025 security deposit bill (HB 2901), the maximum security deposit in Texas is one month’s rent for leases signed after September 1, 2025. This change brings the average security deposit closer to the state median of $1,550 to $1,850.
{{ state }} security deposit interest
Interest on security deposit in Texas isn’t mandated by state law security deposit regulations. It means you can hold in your choice of account (interest or non-interest-bearing) and pay no security deposit interest rate to tenants.
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
Hold each security deposit in separate non-interest or interest-bearing accounts that earn up to [v="apyvalue"] APY².
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 (no limit for leases signed before Sept 1, 2025)
No
No escrow account; Keeping a clear record is mandated
Repairs, unpaid rent or utilities, lease violations, and cleaning costs
30 days
Additional resources
ARTICLE
How to collect security deposits
FAQs
How much security deposit can a landlord charge in Texas?
Texas security deposit limit is one month’s rent as per the bill (HB 2901 bill for leases signed after September 1, 2025. You can’t ask for the first and last month's rent plus a security deposit, as it might exceed the state cap.
Is interest required on tenant security deposits in Texas?
There is no Texas security deposit interest requirement under state law, as landlords aren’t obligated to hold funds in an interest-bearing landlord-tenant security deposit bank account in Texas, and any interest earned during the tenancy does not need to be shared with the tenant.
How should I issue a security deposit receipt to tenants in Texas?
Landlord's rights security deposit rules don’t ask landlords to issue a write receipt, but it’s considered a best practice among many property owners. Include the deposit amount paid, the date, and the address of the rental unit. This creates a clear paper trail for both parties.
How many days to return a security deposit in Texas?
A landlord must return the tenant's security deposit in Texas before the 30th day after the tenant moves out of the property. This 30-day window starts only after the tenant provides a written statement of their forwarding address.
What can a landlord deduct from a security deposit in Texas?
Deductions are allowed for unpaid rent, utilities, and damages to the property (house rental, condo, apartment )beyond normal wear and tear. If you retain any part of the deposit in bad faith, you could be liable for double damages—specifically, $100 plus three times the portion of the deposit wrongfully withheld—along with attorney fees. If you retain all or part of the deposit, share a written description of all the deductions. This list isn’t required if the tenant owes rent and there's no dispute over the amount owed.
Can a security deposit be used for unpaid rent in Texas?
Yes. If a tenant owes rent and there is no dispute over the amount, you can deduct it directly. While a separate security deposit escrow account in Texas is not mandated, keeping these funds in a separate savings account can help you keep them organized for such deductions.
Can landlords keep a security deposit for breaking a lease in Texas?
Yes, if a tenant is breaking lease terms, the landlord's security deposit in Texas can be used to cover lost rent and the costs associated with finding a replacement tenant.
