Sending a Security Deposit Accounting Letter to Tenants

10 Jun

Security deposits are a necessity, but they also require proper documentation to keep everything on the up-and-up. According to the Texas Property Code, landlords must provide a refund of the security deposit (if any) and an itemized list of all deductions within 30 days of the property being surrendered.

Security Deposit Deduction

An important caveat: the tenant must provide a forwarding address (in writing). In absence of one, we send the letter to their old address using certified mail, return receipt requested. It isn’t common, but there have been tenants who intentionally “disappear” so that it is harder for us to collect for excessive damages. The post office will either forward it on to them, or we’ll have documentation showing delivery was attempted.

Below is the template for our security deposit accounting letter. There are two variations for the “Resulting Balance” section, depending on whether the deposit was sufficient to cover any deductions.


Today’s Date: [MM/DD/YYYY]

Tenant’s Name: [Name]
Rental Property Address: [Address]
Lease expiration date: [MM/DD/YYYY]
Move-out Date: [MM/DD/YYYY]

Dear [Name],

The purpose of this letter is to account for your security deposit as detailed below.

Credits Received
• Security Deposit – $x
• Itemize any additional credits – $x

Total Credits – $x

Deductions
This is notice that the owner of the leased premises is deducting the following charges and expenses from your security deposit:
• Itemize individual deductions here – $x
• Itemize individual deductions here – $x
• Itemize individual deductions here – $x
• Itemize individual deductions here – $x
• Itemize individual deductions here – $x
• Itemize individual deductions here – $x

Total Deductions – $x

Resulting Balance
The balance due to resident of $x will be returned via [enter payment method].

Sincerely,
[Name]


If deductions exceed the deposit, use this text instead:

Resulting Balance
The balance due to Landlord of $x must be paid upon receipt of this statement.

Please make checks payable to [Name].

Mailing Address:
[Name]
[Address]
[City], [ST] [Zip Code]

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