Security deposits in Connecticut are regulated by Connecticut General Statutes § 47a-21. Certain municipalities may have local laws that supplement state regulations. To ensure full compliance, verify the regulations applicable in your area.

Maximum Security Deposit

For tenants under the age of 62, security deposits are limited to two months’ rent. For tenants 62 years of age or older, security deposits are limited to one month’s rent. 

Holding & Interest Requirements

Holding Requirements: Connecticut state law requires that landlords/property managers keep security deposits in an escrow account at a financial institution located within the state. The account must be kept separate from the landlord/property manager’s personal funds and only be used for holding security deposits.

Payment of Interest: Connecticut law requires landlords/property managers to pay interest on security deposits. The required interest rate is set annually and should not be less than the deposit index set for that year, which can be found here. Landlords/property managers must pay interest annually or credit it towards tenants’ rent.

Information Provided to Tenant: The landlord/property manager must provide tenants with written notice of the amount held as a security deposit, as well as the name and address of the financial institution at which the security deposit is being held, no later than 30 days after receipt or the landlord/property manager’s transfer of the security deposit to another financial institution or escrow account.

Deposit Refunds

Timeline: Security deposits must be returned by either (1) 30 days after the termination of the tenancy or (2) 15 days after receiving written notification of the tenant’s forwarding address, whichever is later.

Permissible Deductions: Landlords/property managers may deduct the following from a security deposit:

• Unpaid rent or utilities
• Damages beyond normal wear and tear

Documentation of Deductions: If any portion of the security deposit is withheld, the landlord/property manager must provide the tenant with an itemized statement of deductions that explains the nature of any such deductions.

‍Penalties for Violations: Failure to return the deposit, interest, or provide an itemized statement as required may result in the landlord/property manager being liable for up to twice the security deposit. If the landlord/property manager’s only violation of the law is failure to deliver accrued interest, the landlord/property manager is liable for the greater of $10 or twice the amount of the accrued interest. Landlords/property managers may also be liable for statutory fines up to $500 as a result of general violations of Connecticut security deposit law.

Sale of the Rental Property

If the rental property is sold, the landlord/property manager must withdraw all security deposits and accrued interest from their escrow account and transfer these amounts to the new owner. The tenants must be notified of the transfer in writing.