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California Security Deposit Rules: From Move-In to Refund
Last reviewed: July 11, 2026
Security-deposit disputes are often described as disagreements about money. More accurately, they are disagreements about evidence.
Was the mark already on the wall? Was the carpet merely worn or actually damaged? Was professional cleaning necessary? Did the repair cost what the owner deducted? Were the required photographs taken?
California’s security-deposit rules now place even greater importance on documentation at move-in, before repairs, after repairs, and when the final accounting is sent.
How much can a California landlord collect?
For most residential tenancies, the maximum security deposit is one month’s rent, in addition to the first month’s rent.
A qualifying small landlord may collect up to two months’ rent as security when the landlord is a natural person—or an LLC whose members are all natural persons—and owns no more than two residential rental properties containing no more than four rental units in total. That exception does not apply when the prospective tenant is a service member.
Amounts called a pet deposit, cleaning deposit, key deposit, or another form of security generally count toward the same overall limit. Renaming the money does not create a separate cap.
The lease may not characterize a security deposit as “nonrefundable.”
What may be deducted from a security deposit?
California permits deductions that are reasonably necessary for specified purposes, including:
Unpaid rent
Repairing tenant- or guest-caused damage beyond ordinary wear and tear
Cleaning needed to return the property to the same level of cleanliness it had at the beginning of the tenancy
Restoring or replacing owner property when the lease authorizes use of the deposit for that purpose
The deposit may not be used for preexisting conditions, ordinary wear and tear, or professional cleaning that was not reasonably necessary to restore the initial level of cleanliness.
The phrase reasonably necessary matters. A deposit is not a renovation budget. The objective is to address a permitted loss, not to leave the owner with a better property than the one originally delivered.
Move-in documentation is now essential
For tenancies beginning on or after July 1, 2025, California law requires the landlord to photograph the unit immediately before or at the beginning of the tenancy.
A strong move-in file should include:
Wide photographs of every room
Close photographs of existing damage
Appliances, fixtures, cabinets, counters, flooring, doors, and windows
Exterior areas included in the tenancy
A written condition checklist
Meter readings where relevant
The date the photographs were taken
A record showing the tenant received or acknowledged the condition report
Photographs should be clear enough to answer a future question. Twenty nearly identical images of a room from the doorway are less useful than a deliberate set showing walls, floors, fixtures, and existing defects.
The tenant’s right to a pre-move-out inspection
After either party gives notice that the tenancy will end—or before a fixed term expires—the landlord must notify the tenant in writing of the option to request an initial inspection and the right to be present.
When requested, the inspection generally occurs no earlier than two weeks before the tenancy ends. The landlord usually provides at least 48 hours’ written notice of the inspection date and time unless the parties sign a waiver.
The inspection has a practical purpose: it gives the tenant an opportunity to correct identified cleaning or repair issues before moving out.
After the inspection, the landlord provides an itemized statement of proposed deductions. The tenant may then address those items before returning possession.
This is not necessarily the final inspection. Damage hidden by the tenant’s belongings or occurring after the initial inspection can still be considered when legally permitted.
Photographs are also required at move-out
Beginning April 1, 2025, a landlord claiming deductions for repairs or cleaning must take photographs:
After possession is returned but before the deductible repair or cleaning begins
After the repair or cleaning has been completed
Those photographs must be included with the final documentation when the law requires them.
The resulting file should tell a simple story:
Move-in condition → move-out condition → work performed → completed condition → actual cost
When one of those stages is missing, the deduction becomes harder to explain.
The 21-day security-deposit deadline
No later than 21 calendar days after the tenant vacates, the landlord generally must provide:
An itemized statement explaining the disposition of the deposit
The remaining refund
Supporting invoices, bills, receipts, or a description of owner-performed work
Photographs supporting permitted repair or cleaning deductions
A good-faith estimate when qualifying work or documentation cannot reasonably be completed within 21 days
When an estimate is used, final documentation generally follows within 14 calendar days after the repair is completed or the necessary records are received. Limited documentation exceptions apply when repair and cleaning deductions together do not exceed $125, although the tenant can request the documentation afterward.
Waiting until day 20 to inspect the unit, seek bids, and organize photographs is an avoidable risk. The deposit timeline should begin as soon as possession is returned.
Electronic return requirements in 2026
When the landlord received the security deposit or rental payments electronically, current California law generally requires the remaining security to be returned electronically to an account designated by the tenant, unless the parties have a written agreement for another method or a statutory exception applies.
The landlord must also notify the tenant of the right to receive the deposit electronically.
The move-out workflow should therefore collect both a forwarding address and the information or written agreement needed for the refund method.
Ordinary wear and tear versus damage
No single list resolves every case, but these examples illustrate the distinction.
Likely ordinary wear:
Minor fading or scuffing consistent with normal use
Light carpet traffic patterns
Gradual aging of finishes
A small number of ordinary picture-nail holes
Hardware loosening through routine use
Possible tenant-caused damage:
Large or numerous wall holes
Burns, tears, or permanent stains
Broken doors or fixtures caused by misuse
Pet urine damage
Missing owner-provided property
Unauthorized alterations that require restoration
Age and useful life matter. Charging the full cost of a brand-new replacement for an old item near the end of its useful life may be difficult to justify. Owners should use a reasonable, well-documented calculation rather than an automatic replacement charge.
City of Los Angeles RSO interest requirement
California’s statewide deposit statute is not the only rule an LA owner may face. For City of Los Angeles RSO units, deposits held for at least one year are generally subject to a local interest requirement.
LAHD set the 2026 simple-interest rate at 3.03%, although an owner may use the actual interest earned when the ordinance’s documentation rules are followed.
Owners should determine whether the unit is RSO-covered and maintain a method for calculating and paying accrued interest.
Common deposit mistakes
Frequent problems include:
Charging a separate deposit that pushes the total above the cap
Labeling a deposit “nonrefundable”
Taking no move-in photographs
Using an automatic carpet-cleaning charge
Deducting for preexisting damage
Failing to offer the initial inspection
Starting deductible work before taking move-out photographs
Sending a dollar amount without invoices or an explanation
Missing the 21-day deadline
Ignoring the electronic-return requirement
Forgetting local deposit-interest rules
Bad-faith retention can expose a landlord to actual damages and statutory damages of up to twice the amount of the security deposit.
Frequently asked questions
Can a security deposit be called nonrefundable?
No. California law prohibits a lease from characterizing security as nonrefundable.
Can a landlord automatically deduct for professional cleaning?
No. Professional cleaning is deductible only when it is reasonably necessary to restore the home to its initial level of cleanliness, excluding ordinary wear and tear.
Does the tenant have to attend the initial inspection?
No. The tenant has the right to request and attend it, but the inspection may proceed without the tenant after the required arrangements and notice.
Are photographs required for every tenancy?
Move-in photographs are required for tenancies beginning on or after July 1, 2025. Move-out before-and-after photographs have been required for claimed repair or cleaning deductions since April 1, 2025.
What happens when repairs cannot be completed within 21 days?
A qualifying good-faith estimate may be used with the initial accounting, followed by the final documentation within the statutory timeframe.
Can the tenant treat the deposit as the last month’s rent?
The deposit is not automatically the final rent payment. An owner should follow the lease and avoid agreeing to any alternative informally or ambiguously.
A deposit is a process, not just money in an account
The most reliable way to prevent a deposit dispute is to prepare for move-out at move-in. Clear photographs, a detailed condition report, an offered inspection, prompt vendor work, and a complete 21-day package make the outcome easier for everyone to understand.
CF Legacy serves rental owners throughout Greater Los Angeles. Owners seeking a more consistent move-in, maintenance, and move-out process can contact the CF Legacy team to discuss management of their property.
