One month, held
to the letter
Since 2019, New York's deposit law is short and sharp: one month maximum, held in trust, returned in fourteen days with itemization — and forfeited entirely by landlords who handle it casually.
Before you read on
- General information as of August 2026; statutes control and penalties are real.
- Not legal advice.
- The 14-day clock in Section 3 is where landlords actually lose.
Point 1The rules at intake
One month's rent is the ceiling for residential deposits — no first-last-and-security stacking, no 'pet deposit' riding on top, no prepaid final months disguising extra security. The deposit goes into a New York bank account separate from the landlord's funds; buildings of six-plus units must use interest-bearing accounts with interest belonging to the tenant (minus a small administrative slice), and the tenant gets written notice of the bank.
Before move-in, tenants are entitled on request to a walk-through documenting existing conditions. Do it regardless of request, with dated photographs both parties can reference — the intake record is half of every deduction defense you will ever make.
Point 2During the tenancy
The deposit sits: it cannot be applied to late rent mid-tenancy at the landlord's election, cannot be spent, and follows the property — building sales transfer deposit obligations to buyers, one of the diligence lines in any tenanted acquisition. Commingling deposits with operating funds is itself a violation with consequences independent of any dispute.
Tenants sometimes ask to 'use the deposit as last month's rent.' The clean answer is no — the deposit secures condition and performance, and converting it informally leaves the unit's condition unsecured. Where a negotiated exit makes it sensible, paper it as a written amendment, not a phone call.
Point 3The 14-day return
The wear-versus-damage line: faded paint, worn carpet paths, small nail holes are living; broken tiles, burns, pet destruction are damage. Judges see both categories weekly and price them predictably — the dated intake photos and move-out photos decide close calls, which is why both exist.
| Step | Requirement |
|---|---|
| Move-out inspection | Offer one before end of tenancy; tenant may attend |
| Return deadline | 14 days after tenant vacates |
| Itemized statement | Written, with the remainder refunded |
| Permissible deductions | Unpaid rent, damage beyond wear, agreed items |
| Ordinary wear and tear | Never deductible — repainting after years is yours |
| Miss the deadline | Forfeit the right to retain any of it |
Courts apply the forfeiture literally: late itemization loses deductions a timely one would have kept.
Point 4For the remote landlord
Delegation with named duties: the manager holds or administers the trust account correctly, runs both walkthroughs with photographs, and owns the 14-day calendar — written into the management agreement as tasks, not implied. Deposit compliance failures are cheap to prevent and disproportionately expensive to litigate from abroad.
And keep the deposit's paperwork with the lease file permanently: bank notices, walkthrough records, the eventual itemization and proof of return. Deposit disputes surface at tenancy's end and in small claims a year later; the landlord with a complete folder wins by producing it.
One month's rent, full stop — no stacking with prepaid last months or extra pet security. Guaranty products and screening carry the underwriting the deposit no longer can.
A separate New York bank account, never commingled; six-plus-unit buildings use interest-bearing accounts with interest to the tenant and written notice of the bank.
At tenancy's end through the itemized settlement, yes; as a mid-tenancy offset at the landlord's election, no. It secures the ending, not the wobbles.
Missing the 14-day deadline with itemization forfeits the right to retain anything — courts apply it literally. The calendar is the whole game.
Wear is time and living: faded paint, worn floors, small holes. Damage is events: breaks, burns, pet destruction. Dated photos from both ends of the tenancy decide the arguments.
Obligations transfer to the buyer with the property — a real diligence line in tenanted acquisitions. Tenants' rights continue uninterrupted.
RELATED GUIDES
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Important notice
The figures on this page are general information as of August 2026 and do not represent an offer, a quote, or a guarantee of any transaction terms. Reinvent NY does not provide legal, tax, or investment advice. Confirm anything material with an attorney and a CPA before you act on it. Nothing here is a solicitation to invest, and no return is promised. Real estate brokerage services are provided through R New York.