Rental Security Deposits

Key Issues and Guidance for Connecticut Landlords and Tenants

When it comes to rental security deposits, both landlords and tenants have specific rights and responsibilities.  The information here provides answers common questions about rental security deposits. Learn the basic rules landlords must follow, the guidelines tenants should know to protect their security deposit, and the options for resolving disputes.  

It is our attempt to help both landlords and tenants understand their obligations and Connecticut’s law.  Connecticut law outlines the rights and responsibilities of both landlords and tenants about the collection, holding and return of rental security deposits.

Landlords, once give the key to your rental apartment or home to a tenant, you must follow basic rules for security deposits.

Tenants, once you accept the key to your new home, you must also follow guidelines to protect your security deposit.

You may wish to review Section 47a-21 of the Connecticut General Statutes for more detailed information.  See also Rights and Responsibilities of Landlords and Tenants in Foreclosed Properties.

Frequently Asked Questions

What Is A Security Deposit?

A security deposit is any advance rental payment or any installment payment other than an advance for the first month’s rent or a deposit for a key or any special equipment. A security deposit remains the tenant’s property, but the landlord holds a security interest in it. Security deposits must be kept in an escrow account in a financial institution located in Connecticut.

How Large A Security Deposit Can A Landlord Require?

Landlords can’t require more than two months’ rent as a security deposit. This limit is reduced to one month’s rent if a tenant is 62 years of age or older.

Do Landlords Pay Tenants Interest On Security Deposits?

Yes. Landlords must pay tenants interest on security deposits of at least the average commercial banks savings deposit rate as annually determined and published by the Banking Commissioner. This interest must be paid annually on the anniversary date of a tenancy. Landlords may pay tenants directly or provide credit toward the next month’s rent.

The rental security deposit interest rate for 2026 is 0.49% - see additional Interest Rate Information
 
Previous Year's Interest Rates

What If A Tenant Is Late Paying Rent?

Tenants forfeit interest on their security deposits for any month(s) when they are more than ten days late paying their rent. The only exception is when a landlord imposes a late charge previously agreed upon in the tenant’s rental agreement.

How Can Tenants Ensure Their Security Deposits Will Be Returned?

Tenants should carefully document their apartment’s condition upon move-in, confirm that condition in writing with their new landlord, and follow the lease terms. Prior to moving out, they should notify their landlord in writing of their plans to leave and must provide written notice of a forwarding address where the landlord may send their security deposit with interest. We strongly recommend that written notices be sent certified mail with a return receipt requested. All rental payments should be made on time, and tenants should repair any damage they cause. Before moving out, if possible, tenants should inspect the apartment together with their landlord. Keys should be returned the day the tenancy ends.

Tenants should inspect the condition of the rental both before moving in and before moving out.

When Do Landlords Have To Return Security Deposits?

Landlords must return security deposits with interest or give tenants written notice of damages being claimed within twenty-one days of when tenancy ends. The only exception is if a tenant fails to provide a written forwarding address: landlords then need not return security deposits or provide a notice of damages until fifteen days after receipt of a forwarding address in writing.

If a landlord does not return a security deposit with interest or provide a written notice of damages within these statutory time limits, the landlord may have to pay the tenant twice the amount of the security deposit.

Tenants may pursue this remedy in court. For further information, see options for resolving disputes. 

A landlord’s written notice of damages must itemize the nature and amount of tenant damages, including any unpaid rent or utility payments, and must be accompanied by the balance, if any, of the tenant’s security deposit not being claimed for damages plus interest.

What Records Should Tenants Keep?

Tenants should save their lease or rental agreement, all rent checks or receipts and, after they move, a copy of the written notice of their new forwarding address which they have provided their landlord. These records should be kept until all accounts have been settled and the tenant’s security deposit with interest has been returned.

Do Tenants Who Fail To Leave After Their Rental Periods End Have To Pay Additional Rent?

Tenants are expected to leave when their leases or rental periods end unless they have made other arrangements with their landlord. Normal rental periods start on the first day of a month and end on the last day of a month. If a lease ends on a certain day, tenants must leave by that date. Tenants who do not leave before the next rental period starts without an agreement with their landlord may have to pay additional rent. If tenants don’t pay additional rent owed, they may lose all or part of their security deposit.

Downloadable Version:

Rental Security Deposits: Key Issues and Guidance for Connecticut Landlords and Tenants Revised 9/2025

The brochure is available in the following languages:

Chinese, French(Haitian Creole), Italian, Polish, Portuguese or Spanish