Washington DC Security Deposit Laws
Nest DC
Though Washington DC is bordered by Virginia and Maryland, it has its own landlord-tenant Laws that differ from the states around it.
While you’re not required to ask your tenants for a security deposit, we recommend requesting one. Security deposits help protect your property from costly damages, which helps your bottom line and
ROI in the long term.
That’s because you can make security deposit deductions to cover unexpected costs. However, you need to follow the district's security deposit laws when making deductions to the deposit, or you may end up facing legal issues.
Below is a comprehensive guide that will help you navigate Washington DC’s security deposit laws with your tenants.
Washington DC Security Deposit Laws
Below are the answers to some of the most common questions landlords have about security deposits in Washington DC.
Security Deposit Limits
Landlords in Washington DC can charge tenants a security deposit that does not exceed one month's rent. While charging more than a month's rent is not an option, charging less is an option that some property owners make in order to attract renters to their rental unit.
In the District of Columbia, a landlord is entitled to seek additional money to cover damages on the property that weren’t covered by the initial security deposit.
Security Deposit Deduction Disclosures
In Washington DC, landlords must detail the circumstances in which they will make deductions from a tenant’s security deposit. As such, we recommend making the list in your lease comprehensive. This will ensure your property and bottom line are protected from financial losses during the rent period.
Common reasons for security deposit deductions included in Washington DC leases include:
- Unpaid rent, utilities, or late payment fees
- Cost of repairing damages exceeding standard wear and tear
- Cleaning costs
In Washington D.C., there are also laws surrounding where you are allowed to store security deposits. Landlords are required to store their tenant's deposit in an interest bearing account established and held in trust in a financial institution located in the District of Columbia. The landlord also needs to give their tenant the name and address of that financial institution where the interest bearing escrow account is located.
Acceptable Deductions from Security Deposits
All properties will require maintenance and repairs at some point. However, there are specific circumstances in which a landlord can make deductions to a tenant’s deposit for maintenance and repairs.
Basically, landlords in the District of Columbia can make deductions when the damages exceed normal wear and tear.
Property Damage vs. Normal Wear and Tear
Determining what issues are property damage and what constitutes normal wear and tear can be difficult at first. But with practice, it gets easier. The definitions below will help you determine whether damage is typical wear and tear.
Normal wear and tear happens as houses age and when a property is used as intended. Examples of wear and tear in residences include the following:
- Loose door handles
- Faded paint and flooring
- Discoloured grout
- Slightly worn carpets
- Stained sinks and bathroom features
Washington, D.C. security deposit law defines property damage as issues requiring maintenance or repairs caused negligently, accidentally or intentionally. You can make deductions from a security deposit when damage to the rental unit is caused by a tenant or their family and friends.
Common examples of damage include:
- Broken tiles or windows
- Large holes in walls or doors
- Missing fixtures
- Heavily stained, burned, or torn carpets
When you draft your lease, be sure to include specific information regarding what damage will result in a security deposit deduction. For instance, instead of “carpet damage,” you can write “burned, torn, or heavily stained carpets.” This will protect you from tenant disputes for repairs should you have to make deductions at the end of their tenancy.
Security Deposit Returns
At the end of a lease, landlords in the District of Columbia have 45 days to return the tenant’s security deposit and interest owed, provided no deductions were made. Landlords must return the deposit by hand or certified mail.
However, if you do make deductions to the renter’s deposit, you have to follow a different timeline. Any finds remaining after the deductions must be returned to the tenant within 30 days, and a statement outlining the deductions made must be provided to the tenant in advance of the return.
Security Deposit Disputes
If you miss important return deadlines, fail to provide the tenant with the interest gained on their deposit or make security deposit deductions, your tenant may file for damages in court. This can result in significant fines, financial losses, and other issues.
Should you have to defend yourself in a civil action branch or small claims court, it’s crucial to bring documents that support your position. For instance, you can bring before and after photos showing that the property damage occurred during the renter’s tenancy.
Additionally, you can bring repair receipts and the itemized list of deductions to prove that your deductions were valid.
Bottom Line
Whether you’re a new landlord or an experienced investor, knowing Washington DC’s security deposit laws is crucial to your success. Security deposits can be a great way to protect your property, but navigating the laws yourself can be complicated.
If you want to make sure your leases include appropriate security deposit disclosures and that any deductions you make fully comply with District of Columbia landlord-tenant law, reach out to
Nest DC. Our team of experts will help you maximize your ROI and ensure the success of your rental!
Disclaimer: This blog isn’t intended to be a substitute for professional legal advice. Laws change and this information may become obsolete at the time you read it. For further help, please get in touch with a qualified attorney or an experienced property management company.
