As you move into your new apartment, you might not be thinking much about the security deposit. That may change when you decide to move, and the landlord doesn’t return the full amount. What are your landlord’s responsibilities, what can be deducted from your deposit, and the crucial timelines for its return? What are the penalties your landlord could face if he or she fails to follow the rules?

What is a security deposit?

By definition, a security deposit is all monetary amounts paid by the tenant and collected by a landlord, in excess of one month’s rent. A security deposit may include amounts that the  tenant may not think would be part of a security deposit, such a pet deposit. This definition is important as it will identify the amounts that need to be returned to the tenant or accounted for at the end of the tenancy.

What can be withheld from a security deposit?

Wisconsin law allows a landlord to withhold for certain expenses from a security deposit. These include:

• Unpaid rent;
• Unpaid utilities owed to either your landlord or a government-owned utility;
• Damages caused to the leased premises that are beyond normal wear and tear; and
• Any other expenses provided for in the Nonstandard Rental Provision document.

Carefully read the Nonstandard Rental Provisions document

The Nonstandard Rental Provisions document is a document that you will sign and initial at the time you sign your lease or renew it, which will include items that your landlord can withhold from your security deposit. This document must be specifically identified as “Nonstandard Rental Provisions” and it must be a separate document from the lease.

It is important that you carefully review this document and understand the terms found in the document as it will significantly impact the return of your security deposit. Any amounts withheld by your landlord, outside of those outlined above, would be considered a wrongful withholding of the security deposit.

When does the security deposit need to be returned? 

A landlord is required to return the security deposit within 21 days from:

• The date the rental agreement ends if the tenant moves out at that time;
• The date the rental agreement ends if the tenant moves out earlier or gets evicted, unless the landlord rents the place to someone else before the agreement ends. In that case, it’s when the new tenant moves in, or
• The date the landlord learns the tenant moved out or was evicted if it’s after the rental agreement ends.

Landlord requirements

Your landlord must do one of two things: return your full security deposit or provide a detailed report, known as a security deposit settlement. This should list each damaged item or claim and the corresponding deduction. The landlord must send this security deposit or the settlement by mail or in person. If you fail to give your landlord a new address, they must send it to your previous known address, usually the address of the leased premises.

Landlord Penalties

If the landlord wrongfully withholds the security deposit or fails to return the security deposit, they can be held liable for double the amount of the security deposit, along with your actual attorneys’ fees. Additionally, you may also make a claim for conversion and statutory theft, which are legal avenues that allow tenants to seek compensation and remedies when their property or assets are wrongly taken or used by others.  A judgment in your favor could result in your landlord being responsible for triple the compensation you’re owed, along with your attorneys’ fees.

Conclusion

Tenants are provided with considerable rights relating to security deposits. Wisconsin law does not allow courts discretion in the interpretation of these laws. If your landlord does not comply with these laws, you may have a claim. Contact a landlord/tenant attorney in your area. You also have the right to file a complaint with a governmental agency, such as the Wisconsin Department of Agriculture Trade and Consumer Protection.