California Landlord Guide
How Much Security Deposit Can I Charge in California?
AB 12 rewrote the rules in 2024. Here’s exactly what you can collect, what counts toward the limit, and what happens if you get it wrong.
Quick Answer
AB 12 (effective July 1, 2024) limits security deposits to 1 month’s rent for most landlords. Small landlords who own 2 or fewer residential properties with a combined total of 4 or fewer units may collect up to 2 months’ rent. First month’s rent, last month’s rent, and cleaning deposits all count toward that limit.
Deposit Limits at a Glance
| Landlord Type | Max Deposit | On $2,000 Rent | On $3,000 Rent |
|---|---|---|---|
| Most landlords (3+ units or 3+ properties) | 1 month | $2,000 max | $3,000 max |
| Small landlord (≤2 properties, ≤4 units total) | 2 months | $4,000 max | $6,000 max |
| Furnished unit (small landlord) | 2 months | $4,000 max | $6,000 max |
Note: Prior to AB 12, furnished units allowed up to 3 months’ rent. AB 12 eliminated that exception for most landlords.
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What Counts Toward the Deposit Limit?
This is where many landlords accidentally violate the law. Under California Civil Code §1950.5, the deposit cap applies to the total of all money collected upfront, regardless of what you call it:
- Last month’s rent — counts toward the limit
- Cleaning deposit — counts toward the limit
- Pet deposit — counts toward the limit
- Key deposit or other fees — counts toward the limit
- First month’s rent — does not count (it’s rent, not a deposit)
Example: If you charge first month ($2,000) + last month ($2,000) + cleaning ($500), you’ve collected $2,500 in deposits. That exceeds the 1-month cap by $500 for a standard landlord — even though the labels sound reasonable.
The 21-Day Return Rule
After your tenant moves out, you must:
- Return the deposit within 21 calendar days of the tenant vacating
- Provide an itemized written statement for any deductions, including copies of receipts or invoices for work costing over $125
- Mail or deliver the statement and remaining balance together
If you fail to return the deposit or provide the itemized statement within 21 days, you forfeit your right to make any deductions and must return the full deposit.
Allowable Deductions
You may deduct from the security deposit for:
- Unpaid rent owed at the time of move-out
- Cleaning costs to restore the unit to the condition it was in at move-in (beyond normal use)
- Repair of damage caused by the tenant, their guests, or pets
You may not deduct for:
- Normal wear and tear — faded paint, worn carpet from regular use, minor scuffs
- Pre-existing damage that was present at move-in
- Improvements that upgrade the unit beyond its original condition
Penalties for Violations
California courts take deposit violations seriously. If a court finds you acted in bad faith:
- Tenant is entitled to actual damages (the deposit amount wrongfully withheld)
- Plus statutory damages of up to 2x the deposit amount
- Plus court costs and attorney’s fees
On a $3,000 deposit, a bad-faith ruling could cost you $9,000 or more in damages alone — before attorney fees.
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Try Free →Disclaimer: This content is for informational purposes only and does not constitute legal advice. Laws vary by jurisdiction and change frequently. Consult a licensed attorney for advice specific to your situation.
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