Ohio Security Deposit Law: Limits, Deadlines & Deductions

Start with the interest rule

Most of Ohio’s deposit law is ordinary. The interest rule is the part that catches small landlords. Under Ohio Rev. Code § 5321.16, you owe interest at 5% a year on the portion of the deposit that exceeds the greater of $50 or one month’s rent, if the tenant stays six months or more. The interest is computed and paid annually.

Here’s what that looks like at a $1,600 rent:

Deposit you collect	Amount above $1,600	Interest owed per year
$1,000	$0	$0
$1,600	$0	$0
$2,000	$400	$20
$2,400	$800	$40
$3,200	$1,600	$80

At one month’s rent or less, you owe nothing. Go above that, and you’re on the hook for annual interest and a little extra paperwork. Whether a bigger deposit is worth it depends on your tenant pool, but the interest itself is small.

Because Ohio has no cap, a pet deposit stacked on the main deposit doesn’t break any limit, but it can push the total over one month’s rent and into interest territory. If you count it as part of the security deposit, count it in the interest math too. Assistance animals can’t be charged a pet deposit under fair housing rules.

The 30-day return

Within 30 days after the lease ends and the tenant delivers possession, return the deposit along with an itemized written list of anything you kept. The list should name each deduction and the amount. Send it to the forwarding address the tenant gave you in writing.

Ask for that address at move-out. It matters to both sides: a tenant who never gave one generally can’t collect the extra damages described below, but you still have to return what you owe.

What you can deduct

You can apply the deposit to unpaid rent and to damage the tenant caused by not meeting their obligations under the lease and Ohio’s tenant-duties statute. You can’t charge for normal wear and tear.

A 1960s ranch house in Akron after a three-year lease is a good test case:

• Wear: faded kitchen paint, scuffs along hallway walls, a dishwasher rack with rust spots from age.
• Damage: a cracked toilet tank lid, a basement door with the frame split from being forced, nicotine staining throughout (if smoking was barred in the lease), a mailbox the tenant backed into.
• Unpaid amounts: the last month’s rent if it wasn’t paid, and lease charges such as unpaid water if the lease made the tenant responsible.

Keep receipts and dated photos for every deduction. The statute requires an itemized list, and a court will expect you to back each line.

A worked example at $1,600 a month

You rent an Akron house for $1,600 and collected $2,400. The tenant stayed two full years, so interest applies.

Interest owed: $2,400 minus $1,600 = $800 excess. At 5%, that’s $40 a year. If you paid it annually, you owe nothing more at move-out. If you didn’t, add $80 for the two years to the final accounting.

At move-out:

• Replace the cracked toilet tank lid: $85
• Repair the forced basement door frame: $260 (handyman invoice)
• Faded paint and hallway scuffs: $0, wear and tear

Deductions are $345. Assuming you hadn’t paid interest along the way, the refund is $2,400 plus $80, minus $345, for $2,135, mailed with the itemized list within 30 days.

The double-damages penalty

If you wrongfully withhold any part of the deposit, the tenant can recover the amount wrongfully withheld, an equal amount in damages, and reasonable attorney fees. On a $345 deduction you can’t support, that’s $690 plus the tenant’s lawyer, which often costs more than the repair.

Owners who live outside the county or out of state also have to register the rental with the county auditor. It isn’t a deposit rule, but a missing registration is one more thing that can complicate a dispute.

This page is general information, not legal advice. For a disputed deposit, a local attorney or your municipal court’s self-help resources are the place to start.