New York Security Deposit Law: Limits, Deadlines & Deductions
In New York you can collect no more than one month's rent as a security deposit, and you have 14 days after the tenant moves out to return it with an itemized statement. Miss the 14 days and you forfeit the right to keep any of it. This guide covers that part of New York landlord tenant laws: what the cap includes, the inspection offers, interest, deductions and the penalties.
By LandlordTested editorial teamLast reviewed
New York deposit rules
- Maximum deposit
- 1 month's rent (HSTPA 2019)
- Return deadline
- 14 daysReturn within 14 days after the tenant vacates with an itemized statement of deductions; failing to provide the statement on time forfeits the landlord's right to keep any part of the deposit.
- Interest on deposits
- Conditional
- Itemized list of deductions
- Yes
General information, not legal advice. Last legal review October 18, 2026. Laws change; check the statute or a local landlord-tenant attorney before acting.
On this page
The cap covers more than the deposit
The 2019 Housing Stability and Tenant Protection Act limited security deposits to one month’s rent statewide. The limit reaches any deposit or advance payment, not only the line on the lease labeled “security.” So with a $1,600 rent, the most you can collect at signing is the first month’s rent plus $1,600.
That rules out a few common setups from other states:
- First, last and security. Last month’s rent counts as an advance, so you can’t take it on top of a full deposit.
- A separate pet deposit. Fine in principle, but it comes out of the same one-month limit. And assistance animals can’t be charged one.
- An application fee above $20. Separate from the deposit, but capped at your actual cost or $20, whichever is less, under RPL § 238-a.
Holding the deposit
Under N.Y. Gen. Oblig. Law § 7-103, the deposit stays the tenant’s money held in trust. Don’t mix it with your own funds.
In buildings with six or more units, the deposit must go in an interest-bearing account. The tenant earns the interest, and you can keep 1% a year of the deposit as an administrative fee. In smaller buildings, interest isn’t required, but the no-commingling rule still applies. If you put the deposit in a bank, tell the tenant in writing which bank and how much.
If you sell the building, the deposits move with it. Hand them to the buyer and notify the tenants.
The inspections you must offer
Before move-in, offer the tenant a joint inspection and a written record of the unit’s condition. Once either side gives notice that the tenancy is ending, tell the tenant in writing that they can request an inspection before they move out. At that inspection, point out anything you’d deduct for, so the tenant has a chance to fix it.
This step feels like extra work, but it prevents most deposit disputes. A tenant who was told about the scratched countertop on walk-through day is far less likely to argue about the charge.
The 14-day statement
Within 14 days after the tenant vacates, give them an itemized statement of the deductions and return the balance. New York doesn’t give you a grace period. If the statement goes out on day 15, you forfeit the right to keep any of the deposit.
The allowed deductions under N.Y. Gen. Oblig. Law § 7-108 are:
- Unpaid rent
- Damage beyond ordinary wear and tear
- Unpaid utility charges the lease made the tenant’s responsibility
- Moving and storage costs for belongings the tenant left behind
You carry the burden of proving each deduction is reasonable. Ordinary wear and tear (worn finishes, minor scuffs, faded paint) never qualifies.
A worked example at $1,600 a month
You own a three-family house in Buffalo and rent the second-floor unit for $1,600. At signing you collected the first month and a $1,600 deposit, held in a separate account (no interest required with three units). The lease ends June 30.
On June 10 you send the move-out inspection notice. The tenant requests one, and on June 20 you point out a broken bedroom window and grease caked inside the oven. They clean the oven before leaving but don’t fix the window.
They vacate June 30, leaving a couch on the porch.
- Window replacement: $240 (glazier’s invoice)
- Removing and disposing of the couch: $90
- Oven: $0, the tenant cleaned it after the inspection
- Worn hallway carpet: $0, ordinary wear and tear
You send the itemized statement and a check for $1,270 by July 14. If the statement had gone out July 15, you’d owe the full $1,600.
Penalties
Missing the 14-day statement forfeits your right to the deposit. A willful violation of the deposit rules can also bring punitive damages of up to twice the deposit. New York also treats unlawful self-help eviction seriously (RPL § 768), so never change the locks to force out a tenant over a deposit or rent dispute.
The cites are N.Y. Gen. Oblig. Law §§ 7-103 and 7-108. This page is general information, not legal advice. For a deposit dispute, check with a New York landlord-tenant attorney or the local court’s help center.
Questions landlords ask
The questions we get most, each answered in a paragraph.
How much can a New York landlord charge for a security deposit?
One month's rent at most. Since the 2019 Housing Stability and Tenant Protection Act, that limit covers deposits and advance payments together, apart from the first month's rent. So with a $1,600 rent you can collect the first month plus up to $1,600 more, whether you call it a security deposit, a pet deposit or last month's rent.
How long does a landlord in New York have to return a security deposit?
Fourteen days after the tenant vacates. Within that time, return the deposit or give the tenant an itemized statement of deductions along with any balance. If you don't send the statement within 14 days, you lose the right to keep any part of the deposit, even for real damage.
Do New York landlords have to pay interest on deposits?
In buildings with six or more units, yes. The deposit must go in an interest-bearing account, and the tenant gets the interest, minus a 1% per year administrative fee you can keep. In smaller buildings interest isn't required, but the deposit still can't be mixed with your own money.
What can a New York landlord deduct from a security deposit?
Unpaid rent, damage beyond ordinary wear and tear, unpaid utility charges the lease makes the tenant responsible for, and the cost of moving and storing belongings the tenant left behind. You can't deduct for ordinary wear and tear, and you carry the burden of showing your deductions are reasonable.
Do I have to offer a move-out inspection in New York?
Yes. You must offer the tenant an inspection before they move in, and tell them in writing that they can request one before they move out. The move-out inspection gives the tenant a chance to fix problems you point out before you deduct for them, so it often heads off disputes.