New York City has some of the strongest security deposit protections for tenants in the country. Since the 2019 Housing Stability and Tenant Protection Act, landlords face strict limits on how much they can charge, how they must hold your deposit, and how quickly they must return it. Many landlords violate these rules — often because tenants don’t know what the law actually requires.

How Much Can a Landlord Charge for a Security Deposit?

Since June 14, 2019, New York State law caps security deposits at one month’s rent for all residential rentals — regardless of whether the apartment is rent-stabilized, market-rate, or anything in between. This applies statewide, including all five NYC boroughs.

Before 2019, landlords could charge up to two months’ rent on unregulated apartments. That is no longer legal. If your landlord is asking for more than one month’s rent as a security deposit, they are violating New York law.

What this means in practice: If your monthly rent is $2,500, your landlord can ask for a maximum of $2,500 as a security deposit. They cannot ask for $5,000 as a “first and last month” arrangement where the last month serves as a deposit.

How Must a Landlord Hold Your Security Deposit?

New York law (General Obligations Law § 7-103) requires landlords of buildings with six or more units to hold security deposits in a separate bank account, apart from their own funds. They cannot commingle your deposit with their operating funds or personal money.

For buildings with six or more units, the landlord must:

• Deposit your security deposit in a bank within New York State
• Provide you with written notice of the bank’s name and address and the account number within 30 days of receiving the deposit
• Keep the funds in a trust account separate from their own money

For buildings with fewer than six units, the deposit must still be held separately, but the bank account notification requirement is less stringent.

Are You Entitled to Interest on Your Security Deposit?

In buildings with six or more units, your landlord is required to hold your deposit in an interest-bearing account. You are entitled to the interest earned — minus a 1% annual administrative fee the landlord is permitted to keep. The landlord must either pay you the interest annually or credit it to your rent, whichever you choose.

In smaller buildings (fewer than six units), there is no statutory requirement that the account bear interest.

When Must a Landlord Return Your Security Deposit?

This is where many landlord violations occur. Under the 2019 law, your landlord must return your security deposit — or the portion they are not withholding — within 14 days after you vacate the apartment.

Along with the return (or in lieu of a full return), the landlord must provide an itemized written statement of any deductions. This statement must list each deduction, its dollar amount, and the reason for it.

If your landlord fails to return the deposit or provide the itemized statement within 14 days, they forfeit the right to keep any portion of the deposit. They owe you the full amount back — even if there were legitimate deductions they could have made.

What Can a Landlord Legally Deduct?

Landlords can only deduct from your security deposit for:

• Unpaid rent — rent you actually owe at the time you vacate
• Damage beyond normal wear and tear — physical damage you or your household caused that exceeds ordinary use

They cannot deduct for:

• Normal wear and tear — scuffs on walls, minor carpet wear, small nail holes from hanging pictures
• Pre-existing conditions that existed before you moved in
• Repairs that were the landlord’s legal obligation regardless of your tenancy
• Repainting the apartment after a normal tenancy (unless you painted it an unusual color without permission)
• Cleaning that constitutes normal end-of-tenancy maintenance

How to Protect Yourself: Move-In and Move-Out Documentation

The single most important thing you can do to protect your security deposit is to document the apartment’s condition at move-in and move-out.

At Move-In

• Do a thorough walkthrough with your landlord or super present
• Photograph and video every room, every wall, every appliance, every fixture — even things that look fine
• Note any pre-existing damage in writing and have your landlord sign it, or send it via email immediately after moving in
• Request a copy of any existing inspection report

At Move-Out

• Do the same walkthrough with the landlord if possible — request one in writing
• Photograph and video the entire apartment in the same way
• Return your keys and document the date and method of return
• Provide your forwarding address in writing so the deposit and itemized statement can be sent to you within 14 days

What to Do If Your Landlord Wrongfully Keeps Your Deposit

Step 1: Send a Demand Letter

Send your landlord a certified letter (return receipt requested) or email demanding return of the deposit within a specific deadline (give 14 days). Reference the 14-day return requirement and state that you will pursue legal action if they don’t comply. Keep a copy.

Step 2: File in NYC Small Claims Court

NYC Small Claims Court handles disputes up to $10,000 — which covers most security deposit cases. You do not need an attorney. Filing fees are modest. The court is designed for non-lawyers to use without legal representation.

File at the small claims clerk’s office in the county where your apartment is located:

• Manhattan: NYC Civil Court, 111 Centre Street
• Brooklyn: 141 Livingston Street
• Queens: 89-17 Sutphin Blvd, Jamaica
• Bronx: 851 Grand Concourse
• Staten Island: 927 Castleton Avenue

Bring your lease, move-in and move-out photos, the itemized statement (if you received one), any correspondence with your landlord, and proof of your forwarding address notification.

What You Can Win

In small claims court, you can recover the withheld deposit amount. If your landlord failed to return the deposit or itemized statement within 14 days, courts have found landlords liable for the full deposit regardless of whether any deductions were legitimate. You may also be awarded court costs.

Free Help

• Met Council on Housing: (212) 979-0611 — tenant advice hotline
• NYC Small Claims Court Self-Help: nyc.gov/courts
• Legal Aid Society: legalaidnyc.org
• NYC Bar Association Lawyer Referral: (212) 626-7373

Frequently Asked Questions

My landlord is asking for two months’ security deposit. Is that legal?

No. Since June 2019, New York law caps security deposits at one month’s rent for all residential rentals. Demanding more is a violation of General Obligations Law § 7-108.

My landlord hasn’t returned my deposit after 30 days. What can I do?

File immediately in NYC Small Claims Court. The landlord was required to return your deposit or provide an itemized statement within 14 days of your vacating. Failure to do so means they forfeit the right to make any deductions — you are entitled to the full amount back.

My landlord sent an itemized statement with deductions for repainting. Is that valid?

Generally no. Repainting after a normal tenancy is considered normal wear and tear and is the landlord’s responsibility. Unless you painted walls an unusual color without permission or caused actual damage to the walls beyond normal use, repainting is not a valid deduction.

I gave 30 days’ notice but my landlord says I owe an extra month. Can they take it from my deposit?

Whether your landlord can deduct alleged unpaid rent depends on whether the amount is genuinely owed under your lease. If you dispute the charge, respond in writing immediately and, if the deposit is withheld, file in small claims court. The landlord must prove the rent was owed.