Indiana Security Deposit Law

Maximum deposit

Indiana sets no limit on the amount of a residential security deposit (Ind. Code 32-31-3, silent). (Ind. Code 32-31-3 (no amount limit))

Return deadline

Landlords must return the deposit, minus itemized deductions, within 45 days after the rental agreement ends and the tenant delivers possession, once the tenant has given a written mailing address (Ind. Code 32-31-3-12(a), 32-31-3-14). (Ind. Code 32-31-3-12(a), Ind. Code 32-31-3-14)

Itemized statement of deductions

The landlord must mail an itemized list of damages with the estimated repair cost of each item, together with a check for the balance (Ind. Code 32-31-3-14). (Ind. Code 32-31-3-14, Ind. Code 32-31-3-12(a))

Interest on the deposit

Indiana law does not require landlords to pay interest on security deposits (Ind. Code 32-31-3, silent). (Ind. Code 32-31-3 (silent on interest))

Penalty for wrongful withholding

A landlord who misses the 45-day itemized notice is treated as agreeing that no damages are due and owes the full deposit plus reasonable attorney's fees and court costs (Ind. Code 32-31-3-12(b), 32-31-3-15, 32-31-3-16). (Ind. Code 32-31-3-12(b), Ind. Code 32-31-3-15, Ind. Code 32-31-3-16)

Where the deposit is held

Indiana does not require landlords to hold security deposits in a separate, escrow or interest-bearing account (Ind. Code 32-31-3, silent). (Ind. Code 32-31-3 (no account requirement))

Receipt or written notice of the deposit

Indiana's deposit chapter does not require a deposit receipt, though the landlord must give the tenant in writing, at the start of the tenancy, the names and addresses of the manager and the owner's agent (Ind. Code 32-31-3-18). (Ind. Code 32-31-3 (no receipt requirement), Ind. Code 32-31-3-18)

Move-in condition checklist

Indiana law does not require a move-in inspection or condition checklist; the only move-in sign-off required is the tenant's written acknowledgment of a working smoke detector (Ind. Code 32-31-5-7). (Ind. Code 32-31-3 (no move-in inspection requirement), Ind. Code 32-31-5-7)

Pet deposits

Indiana has no pet-deposit statute; a pet deposit is just another refundable security deposit, and Indiana sets no cap on deposits (Ind. Code 32-31-3-9). (Ind. Code 32-31-3-9)

Nonrefundable fees

Indiana neither bans nor limits nonrefundable fees; its deposit chapter covers only money returnable to the tenant, and anything else paid under the lease is treated as rent (Ind. Code 32-31-3-6, 32-31-3-9). (Ind. Code 32-31-3-6, Ind. Code 32-31-3-9)

Small-landlord exemptions

Indiana's deposit rules apply to all residential landlords alike; the chapter has no exemption for small or owner-occupied rentals (Ind. Code 32-31-3). (Ind. Code 32-31-3 (no size-based exemption))

Deposit alternatives and installments

An Indiana landlord may accept, but may not require, a lien on the tenant's motor vehicle as the security deposit or as security for rent (Ind. Code 32-31-3-13.5). (Ind. Code 32-31-3-13.5)

To enforce the lien the landlord must file or record it under IC 32-33 and follow all security-deposit rules in IC 32-31-3. The statute does not address surety bonds, deposit insurance or installment payments.