Tennessee Security Deposit Law

Maximum deposit

Tennessee sets no limit on the amount of a security deposit, but in URLTA counties the deposit must be kept in a separate account used only for deposits and the tenant must be told where it is held (Tenn. Code Ann. § 66-28-301(a), (h)). (Tenn. Code Ann. § 66-28-301 (no amount limit; as amended by 2011 Pub. Ch. 272), Tennessee General Assembly bill history: HB1760/SB1009 enacted as Pub. Ch. 272 (signed 2011-05-25, eff. 2011-10-01))

Return deadline

Tennessee sets no fixed number of days to return a deposit; when a refund is due the landlord must send the tenant written notice of the amount to the last known address, and may keep the refund if the tenant does not respond within 60 days of that notice (Tenn. Code Ann. § 66-28-301(f)). (Tenn. Code Ann. § 66-28-301(f), (g) (no return deadline; subsection (f) unchanged by 2011 Pub. Ch. 272), Tennessee General Assembly bill history: HB1760/SB1009 enacted as Pub. Ch. 272 (signed 2011-05-25, eff. 2011-10-01))

Itemized statement of deductions

To charge damage against the deposit, the landlord must compile a written listing of the damage with estimated repair costs (jointly signed if the tenant requests a move-out inspection, or mailed to the tenant on written request otherwise) (Tenn. Code Ann. § 66-28-301(b)). (Tenn. Code Ann. § 66-28-301(b), (c) (as amended by 2011 Pub. Ch. 272, §§ 6, 8), Tennessee General Assembly bill history: HB1760/SB1009 enacted as Pub. Ch. 272 (signed 2011-05-25, eff. 2011-10-01))

Interest on the deposit

Tennessee law does not require landlords to pay interest on security deposits (Tenn. Code Ann. § 66-28-301 is silent on interest). (Tenn. Code Ann. § 66-28-301 (silent on interest), Tennessee General Assembly bill history: HB1760/SB1009 enacted as Pub. Ch. 272 (signed 2011-05-25, eff. 2011-10-01))

Penalty for wrongful withholding

A landlord who neither kept the deposit in the required separate account nor provided the required damage listing may not keep any portion of the deposit (Tenn. Code Ann. § 66-28-301(c)). (Tenn. Code Ann. § 66-28-301(c) (as amended by 2011 Pub. Ch. 272, § 8), Tennessee General Assembly bill history: HB1760/SB1009 enacted as Pub. Ch. 272 (signed 2011-05-25, eff. 2011-10-01))

Where the deposit is held

In the 17 Tennessee counties covered by the URLTA (over 75,000 residents in the 2010 census), every deposit collected before move-in has to sit in an account reserved solely for deposits at a state- or federally regulated bank or lender (Tenn. Code Ann. § 66-28-301(a)). (Tenn. Code Ann. § 66-28-301 (as amended by 2011 Pub. Ch. 272), Tennessee General Assembly bill history: HB1760/SB1009 enacted as Pub. Ch. 272 (eff. 2011-10-01))

The account must be used only for security deposits and be at a bank or other lending institution regulated by Tennessee or a federal agency. A landlord who skips the account and also fails to provide the damage listing may not keep any of the deposit (§ 66-28-301(c)).

Receipt or written notice of the deposit

Tennessee landlords in URLTA counties have to tell tenants where the deposit account is located at the moment the lease is signed and the deposit is handed over (Tenn. Code Ann. § 66-28-301(h)). (Tenn. Code Ann. § 66-28-301(h), Tenn. Code Ann. § 66-28-301 (as amended by 2011 Pub. Ch. 272))

The landlord must disclose the location of the deposit account when the tenant signs the lease and pays the deposit, but need not give the account number. The statute does not require a written receipt for the deposit itself.

Move-in condition checklist

Tennessee's deposit statute requires no move-in condition checklist; its inspection rules cover only the move-out walk-through and damage listing in URLTA counties (Tenn. Code Ann. § 66-28-301(b)). (Tenn. Code Ann. § 66-28-301 (as amended by 2011 Pub. Ch. 272), Tennessee General Assembly bill history: HB1760/SB1009 enacted as Pub. Ch. 272 (eff. 2011-10-01))

Pet deposits

In URLTA counties, a tenant with a disability who needs a service or support animal may ask for an exception to a landlord's no-pets rule or to any requirement to pay to keep an animal (Tenn. Code Ann. § 66-28-406(b)). (Tenn. Code Ann. § 66-28-406 (as amended by 2024 Pub. Ch. 754, HB2266/SB2030, eff. 2024-07-01), 2024 Tenn. Pub. Acts ch. 754)

A landlord may ask for reliable documentation of a disability and the disability-related need when not apparent, and since July 1, 2024 documents bought from a website whose main business is selling animal certificates or registrations do not count (2024 Pub. Ch. 754). Misrepresenting a need for a service or support animal is material noncompliance that lets the landlord terminate and recover damages and attorney's fees.

Nonrefundable fees

Nothing in Tennessee's deposit statute bans or limits nonrefundable deposits or fees, so whether a payment is refundable turns on the lease (Tenn. Code Ann. § 66-28-301). (Tenn. Code Ann. § 66-28-301 (as amended by 2011 Pub. Ch. 272), Tennessee General Assembly bill history: HB1760/SB1009 enacted as Pub. Ch. 272 (eff. 2011-10-01))

Small-landlord exemptions

Tennessee's deposit rules carry no exemption based on how many units a landlord owns or whether the owner lives on site; the only carve-outs are geographic (non-URLTA counties) and the § 66-28-102(c)-(d) exclusions such as hotels and HUD-regulated public housing (Tenn. Code Ann. §§ 66-28-102, 66-28-301). (Tenn. Code Ann. § 66-28-301 (as amended by 2011 Pub. Ch. 272), Tennessee General Assembly bill history: HB1760/SB1009 enacted as Pub. Ch. 272 (eff. 2011-10-01))

Deposit alternatives and installments

Tennessee has no statute governing surety bonds, deposit insurance or installment plans in place of a cash deposit; bills to authorize them in 2019-2021 died in committee (Tenn. Code Ann. § 66-28-301). (Tenn. Code Ann. § 66-28-301 (as amended by 2011 Pub. Ch. 272), Tennessee General Assembly bill history: HB1760/SB1009 enacted as Pub. Ch. 272 (eff. 2011-10-01))