Texas Security Deposit Law: A Landlord's Guide to Deductions, Deadlines and Penalties (2026)

Security deposit handling is the most expensive small mistake a Texas landlord can make. A $2,000 deposit withheld in bad faith becomes a $6,100 liability before either side's attorney's fees are counted. The rules themselves are short: all of them sit in about a dozen sections of Chapter 92, Subchapter C, and none of them can be waived in a lease. This guide walks through each one in the order you meet them, from lease signing to the final refund check, with the Dallas–Fort Worth specifics that matter for owners in Dallas, Tarrant, Collin and Denton counties.

If you want the statute-by-statute deep dive on the deadline alone, our §92.103 30-day clock and §92.109 treble-damages guide covers it. This page is the owner's overview: what the law requires, what it forbids, and how to run a move-out that never ends up in justice court.

What counts as a security deposit in Texas?

A Texas security deposit is any advance of money, other than a rental application deposit or an advance payment of rent, that is intended primarily to secure performance under a lease of a dwelling (§92.102). That definition does the sorting for you. An application fee is not a deposit. Prepaid rent is not a deposit. A “pet deposit” or “key deposit” collected to secure the tenant's performance generally is one, and follows the same refund and itemization rules.

Three structural facts frame everything else:

• It applies to every residential lease. Section 92.101 says the subchapter “applies to all residential leases.” There is no small-landlord exemption for the owner of a single house in Frisco or a duplex in Arlington.
• It cannot be waived. Section 92.006(a) says a landlord's duty or a tenant's remedy concerning security deposits under Subchapter C “may not be waived.” A lease clause that gives you 45 days, or that makes the deposit non-refundable, does not override the statute.
• The tenant's claim outranks your creditors. Under §92.103(c), the tenant's claim to the deposit takes priority over the claim of any creditor of the landlord, including a trustee in bankruptcy.

Texas security deposit rules at a glance

Every rule a Texas landlord needs for deposits, with the section that creates it and what happens if you get it wrong:

Is there a limit on how much a Texas landlord can charge for a deposit?

No section of Texas's residential security deposit subchapter sets a maximum amount. We read every section of Chapter 92, Subchapter C, from §92.101 through §92.111, for this update: they regulate what a deposit is, when it comes back, what can be deducted and what happens when it goes wrong, but none caps the amount.

That does not make a large deposit a good idea. In the Dallas–Fort Worth single-family market, where most qualified applicants are comparing several homes at once, a deposit well above one month's rent narrows your applicant pool and lengthens vacancy. And the larger the deposit, the larger the treble-damages number if a withholding is later found to be in bad faith. Set the deposit to match the risk of the specific home and applicant, apply the same standard to every applicant, and write the amount into the lease. If the lease is under a government housing program or other agreement with its own rules, check those rules as well.

The 30-day clock, and what actually starts it

The clock starts on the date the tenant surrenders the premises, not the date the lease ends on paper. Section 92.103(a) requires the refund “on or before the 30th day after the date the tenant surrenders the premises.” If the tenant hands back the keys on September 1, day 30 is October 1. If the tenant holds over for a week past the lease end date, the clock waits for them.

Four details change how the clock works in practice:

• The forwarding address (§92.107). The landlord is not obligated to return the deposit or send the description of damages and charges until the tenant gives a written statement of a forwarding address. But the tenant does not forfeit the refund or the itemization merely by failing to give one. A missing address delays your obligation; it never cancels it. Ask for the address in writing at move-out and put the request in the lease.
• The postmark rule (§92.1041). A landlord is presumed to have refunded the deposit or made the accounting if it is placed in the U.S. mail and postmarked on or before the required date. Mailing on day 30 counts. Keep the receipt.
• Advance-notice conditions (§92.103(b)). A lease requirement that the tenant give advance notice of surrender as a condition of getting the deposit back is effective only if it is underlined or printed in conspicuous bold print in the lease. Buried in ordinary lease text, it does not work. Our Texas residential lease agreement guide covers the other clauses that carry the same formatting requirement.
• Surrender is a factual question. Returned keys, a signed move-out form and an empty home make surrender clear. An abandoned home with belongings inside does not. When surrender is ambiguous, date-stamp the evidence of the day you believe possession came back to you, and count from the earliest defensible date.

What a Texas landlord can deduct from a security deposit

You may deduct “damages and charges for which the tenant is legally liable under the lease or as a result of breaching the lease” (§92.104(a)). The lease is therefore the first document to read at move-out, because it defines what the tenant agreed to pay for. In practice, deductible items usually include:

• Unpaid rent and lease charges the tenant owes at surrender
• Damage beyond normal wear and tear, such as broken fixtures, pet damage, burns, and holes beyond ordinary picture-hanging
• Unreturned keys, garage remotes, gate cards or devices, where the lease prices them
• Cleaning, where the lease requires the home be returned in a stated condition and the condition exceeds ordinary use
• Other charges the lease specifically assigns to the tenant, such as a re-keying charge the tenant agreed to

Each deduction should be tied to a lease provision, a documented condition, and an actual cost. The landlord carries the burden in a deposit suit: under §92.109(c), “the landlord has the burden of proving that the retention of any portion of the security deposit was reasonable.”

What you can't deduct: normal wear and tear

Texas flatly prohibits using any part of a security deposit to cover normal wear and tear (§92.104(b)). Section 92.001(4) defines normal wear and tear as deterioration that results from the intended use of a dwelling, and excludes deterioration that results from negligence, carelessness, accident, or abuse of the premises, equipment or chattels by the tenant, a member of the tenant's household, or a guest or invitee.

One detail in that definition is easy to miss. The statute adds that the term includes “breakage or malfunction due to age or deteriorated condition” “for the purposes of Subchapters B and D”, the repair and security-device subchapters. The deposit rules are Subchapter C. We do not take a position on how a court would treat an age-related failure in a deposit dispute. The conservative operating rule is simple: do not charge a tenant for a 14-year-old water heater that quit or blinds that cracked from sun exposure. If a failure was caused by age rather than by the tenant, it belongs on your capital budget, not on their deposit. Earlier versions of this article described the age clause as part of the general definition; we have corrected it.

The line between wear and damage is a question of cause and degree. These examples are how the line is generally drawn in residential practice. Every case depends on the lease, the length of the tenancy and your move-in documentation:

For how routine inspections during the tenancy make this line easier to prove at the end, see our guide to in-lease versus move-in and move-out inspections.

The itemized list: the document that decides most disputes

If you keep any part of the deposit, §92.104(c) requires you to give the tenant the balance, if any, together with a written description and itemized list of all deductions. The only exception: the tenant owes rent at surrender and there is no controversy about how much rent is owed. If there is any dispute about the rent, itemize anyway.

The statute does not prescribe a form. A list that holds up well usually contains, for each line:

• The room and the specific item (“primary bedroom carpet, 4 ft by 6 ft pet stain near closet”, not “carpet”)
• The lease provision the charge relies on
• The dollar amount, backed by an invoice, a quote or a stated rate
• A reference to the matching move-in and move-out photos

The cost of skipping this is severe. Under §92.109(b), a landlord who in bad faith does not provide the written description and itemized list forfeits the right to withhold any portion of the deposit or to bring suit against the tenant for damages to the premises, and is liable for the tenant's reasonable attorney's fees. You can lose the deposit and the right to recover real damage above it.

What happens if a Texas landlord does not return a deposit within 30 days?

The law presumes bad faith, and bad-faith retention costs $100, plus three times the amount wrongfully withheld, plus the tenant's reasonable attorney's fees. Section 92.109(d) says a landlord who fails either to return the deposit or to provide a written description and itemization of deductions on or before the 30th day after surrender “is presumed to have acted in bad faith.” The presumption can be rebutted, but you start the case behind.

Here is how the §92.109(a) formula scales. These figures exclude attorney's fees and court costs, which are added on top:

Two points owners often miss. First, the multiplier applies to the portion wrongfully withheld, not the whole deposit, which is why a clean itemization that separates solid charges from doubtful ones limits your exposure. Second, the statute does not define “bad faith” in a single sentence; the day-30 presumption is the only bright line. Our §92.103 clock guide covers the bad-faith question and the most common trigger patterns in more depth.

Last month's rent, selling the rental, and no-deposit leases

Can the tenant apply the deposit to the last month's rent?

No. Section 92.108(a) says the tenant may not withhold any portion of the last month's rent on the grounds that the security deposit is security for unpaid rent. The rule cuts both ways: a tenant who does it is presumed to have acted in bad faith, and a tenant who acts in bad faith is liable for three times the rent wrongfully withheld plus the landlord's reasonable attorney's fees (§92.108(b)). A short, polite reminder of §92.108 in the move-out notice letter prevents most of these disputes before they start.

Buying or selling a tenant-occupied rental

When ownership changes by sale, assignment, death, receivership, bankruptcy or otherwise, the new owner is liable for returning security deposits from the date title is acquired (§92.105(a)). The new owner must give the tenant a signed statement acknowledging the purchase and responsibility for the deposit, and specifying its exact dollar amount (§92.105(b)). The seller remains liable for deposits received while an owner until the buyer receives the deposit or assumes the liability, unless a written contract says otherwise (§92.105(b-1)). A mortgage lienholder that acquires title by foreclosure is carved out of subsection (a) (§92.105(c)).

For investors buying occupied homes in McKinney, Plano or Mansfield, the practical takeaway is that the deposit ledger should change hands at closing along with the keys and the leases. Confirm each tenant's deposit amount in writing before closing, credit it in the settlement, and send the §92.105(b) statement promptly.

Leases with no deposit

If the lease did not require a deposit and the tenant owes damages and charges at surrender, §92.110(a) requires you to notify the tenant in writing of your claim on or before the date you report it to a consumer reporting agency or third-party debt collector. The notice is not required if the tenant never gave a forwarding address under §92.107 (§92.110(b)). Skip the notice and you forfeit the right to collect the damages and charges from the tenant (§92.110(c)).

A fee in lieu of a security deposit

Since September 1, 2021, §92.111 has allowed landlords to offer a recurring fee in place of a deposit, on strict conditions. A landlord who offers it must also offer the option of a regular deposit, may not use the tenant's choice as an approval criterion (§92.111(a)), must give written notice of both options and their charges (§92.111(b)), and must put the fee agreement in writing signed by both parties (§92.111(c)). The fee must be a recurring amount payable with each rent payment (§92.111(d)). Unless the conditions in §92.111(h) are met, the fee is treated as a security deposit for purposes of Chapter 92 (§92.111(g)), and a landlord may not charge the tenant for normal wear and tear (§92.111(i)). The section has further notice rules for any claim filed under the arrangement. It is a structure most individual owners will not need; if you consider it, have your lease reviewed first.

Where deposit disputes land in Dallas-Fort Worth

Most Texas deposit disputes are heard in justice court, the same justice of the peace courts that handle evictions. Texas Government Code §27.031(a)(1) gives justice courts original jurisdiction of civil matters where the amount in controversy is not more than $20,000, exclusive of interest, and exclusive jurisdiction is not in the district or county court. Even a trebled deposit on a typical DFW single-family rental generally falls under that ceiling.

Each of the four core DFW counties, Dallas, Tarrant, Collin and Denton, runs its own set of justice of the peace precincts. Homes near county lines, including parts of Frisco, Carrollton and Grand Prairie, can sit in a different county than the owner assumes, so confirm the county and precinct from the appraisal district record before you file or respond. One provision matters for owners who hold rentals in an entity: §27.031(d) says a corporation need not be represented by an attorney in justice court. Whether to handle a case yourself is a separate judgment call, especially with fee-shifting on the table.

For the wider Texas framework that deposit law sits inside, including repairs, retaliation and ending a tenancy, see our Texas landlord-tenant law owner's guide. If the move-out is the end of a non-renewal, our Texas notice to vacate guide covers the notice side.

A move-out playbook that keeps you out of court

The statute sets the deadline; the process is up to you. This is the sequence we recommend, counted from the day of surrender. Only the 30-day deadline is set by law; the other steps are good practice:

Six deposit mistakes that cost Texas owners the most

1. Counting from the lease end date instead of surrender. The statute counts from surrender.
2. Holding the deposit because no forwarding address arrived, then forgetting it. The obligation revives the moment the written address arrives, and the tenant never forfeited the refund (§92.107(b)).
3. Sending a lump-sum “cleaning and repairs” charge. Section 92.104(c) requires an itemized list of all deductions.
4. Charging for age. Replacing a worn-out carpet or an old appliance at the tenant's expense is the classic improper deduction.
5. Relying on a lease clause that waives the rules. Section 92.006(a) makes the deposit rules non-waivable.
6. Keeping loose records. Section 92.106 requires accurate records of all deposits, and without them the §92.109(c) burden is hard to meet.

Deposit handling is one of those jobs where the cost of an error dwarfs the cost of doing it right. Flat Fee Landlord runs this move-out protocol, from inspections and statutory timelines to itemization and refunds, for owners across Dallas–Fort Worth, Houston, Austin and San Antonio, for a flat monthly fee. Your management cost shouldn't rise just because rent did. If you want to know what your home should rent for and what management would look like, get a free rental analysis.

Frequently asked questions

How long does a landlord have to return a security deposit in Texas?

On or before the 30th day after the tenant surrenders the premises (§92.103(a)). You are not obligated to refund or itemize until the tenant gives a written forwarding address, but the tenant does not forfeit the deposit by failing to send one (§92.107).

What happens if a Texas landlord misses the 30-day deadline?

Bad faith is presumed (§92.109(d)). Bad-faith retention exposes the landlord to $100, plus three times the portion wrongfully withheld, plus the tenant's reasonable attorney's fees (§92.109(a)).

Is there a cap on security deposits in Texas?

Chapter 92, Subchapter C (§§92.101 through 92.111) does not set a maximum amount. One month's rent is a common market practice, not a legal rule.

Can I deduct for repainting or carpet cleaning?

Only for damages and charges the tenant is liable for under the lease or for breaching it, and never for normal wear and tear (§92.104). Faded paint and traffic-path carpet wear are generally on the owner; pet stains and damage from misuse are generally on the tenant.

Do I have to itemize deductions?

Yes, with a written description and itemized list of all deductions (§92.104(c)), unless the tenant owes rent at surrender and there is no controversy about the amount.

Does mailing the refund on day 30 count?

Yes. A refund or accounting placed in the U.S. mail and postmarked on or before the deadline is presumed timely (§92.1041).

Can a tenant use the deposit as the last month's rent?

No. A tenant who withholds last month's rent against the deposit is presumed to act in bad faith and, if in bad faith, owes three times the rent withheld plus the landlord's attorney's fees (§92.108).

Who owes the deposit when a rental is sold?

The buyer, from the date title is acquired, with a signed statement to the tenant of the exact amount. The seller stays liable until the buyer receives or assumes the deposit, unless a written contract says otherwise (§92.105).

Can my lease waive these rules?

No. Security deposit duties and remedies under Subchapter C may not be waived (§92.006(a)).

Where does a Dallas or Fort Worth tenant sue over a deposit?

Usually in justice court, which hears civil matters up to $20,000 exclusive of interest (Gov't Code §27.031(a)(1)). Dallas, Tarrant, Collin and Denton counties each run their own precincts.

Sources & last reviewed

Statutory text for every section below was read in full on September 26, 2026, via the texas.public.law mirror of the Texas Statutes, which cites back to the official source at statutes.capitol.texas.gov:

• Texas Property Code §92.001(4), definition of normal wear and tear: https://texas.public.law/statutes/tex._prop._code_section_92.001
• §92.006, waiver of duties and remedies: https://texas.public.law/statutes/tex._prop._code_section_92.006
• §92.101, application of Subchapter C: https://texas.public.law/statutes/tex._prop._code_section_92.101
• §92.102, security deposit defined: https://texas.public.law/statutes/tex._prop._code_section_92.102
• §92.103, obligation to refund: https://texas.public.law/statutes/tex._prop._code_section_92.103
• §92.104, retention of security deposit: https://texas.public.law/statutes/tex._prop._code_section_92.104
• §92.1041, presumption of refund or accounting: https://texas.public.law/statutes/tex._prop._code_section_92.1041
• §92.105, cessation of owner's interest: https://texas.public.law/statutes/tex._prop._code_section_92.105
• §92.106, records: https://texas.public.law/statutes/tex._prop._code_section_92.106
• §92.107, tenant's forwarding address: https://texas.public.law/statutes/tex._prop._code_section_92.107
• §92.108, liability for withholding last month's rent: https://texas.public.law/statutes/tex._prop._code_section_92.108
• §92.109, liability of landlord: https://texas.public.law/statutes/tex._prop._code_section_92.109
• §92.110, lease without security deposit: https://texas.public.law/statutes/tex._prop._code_section_92.110
• §92.111, fee in lieu of security deposit (added by S.B. 1783, eff. September 1, 2021): https://texas.public.law/statutes/tex._prop._code_section_92.111
• Texas Government Code §27.031, justice court jurisdiction: https://texas.public.law/statutes/tex._gov't_code_section_27.031

The wear-and-damage examples and the move-out timeline are general operating practice, not statutory requirements. This article is general information, not legal advice. Consult a Texas-licensed attorney about your specific lease and situation. Last reviewed: September 2026.