What to Know About Your Security Deposit in Illinois

Understand your rights, refund timelines, and landlord obligations

If you’ve ever rented a home, you’ve probably had to pay a security deposit. This is a returnable sum paid to the landlord to cover any possible loss or damage. The security deposit is returned to the tenant when the lease is terminated, provided there is no damage to the property. Typically, if there’s damage or the property requires excessive cleaning, the landlord will deduct those costs from the tenant before returning the deposit. 

This sounds pretty straightforward—and hopefully it is—your money is “held” for the amount of time you rent a unit and then you receive it back. The landlord is required to disclose information about the security deposit to the tenant, including where the deposit is held and the interest rate. 

Here's a look at how security deposits are handled under laws specific to Illinois courts.

An Illinois landlord must return a security deposit within 30-45 days after the tenant vacates. A deduction is permitted for unpaid rent or damages that exceed normal wear and tear. The landlord must provide an itemized statement of deductions. 

A security deposit is typically the amount of one month’s rent, but Illinois law does not impose a legal limit on the amount a landlord can require.

Does an Illinois landlord pay interest on a security deposit?

Yes, Illinois state law requires the landlord to pay interest on a security deposit under certain circumstances:

1. If the deposit is held for at least six months; and 
2. If there are at least 25 units in the complex or building.

The interest would be either paid directly to the tenant or applied as a credit to the rent every year. If the landlord fails to pay interest, the tenant may file a lawsuit to recover an amount equal to the security deposit, in addition to court costs and attorney’s fees.

Receiving your security deposit at the end of the tenancy

Your Illinois landlord must return your security deposit in full within 45 days of the end of your tenancy, as long as:

1. The building or complex has five or more units;
2. You do not owe back rent;
3. The rental unit is not damaged; and 
4. The unit is left clean.

If there are charges against the security deposit for damages, the landlord is required to prove the tenant an itemized statement of damages, along with a receipt for repairs made within 30 days of the date the tenant vacated the unit. 

If the landlord fails to follow the security deposit law, they could be held liable for an amount twice your security deposit, plus court costs and attorney’s fees. 

It’s the tenant’s responsibility to provide the landlord with a current mailing address or email so the landlord may send a written statement of any damage charges. If no contact information is provided, the landlord is no longer obligated to provide receipts or return the security deposit. 

Even if the landlord does not have specific receipts for costs incurred, they must provide an itemized list of costs and other evidence of what they paid for repairs.

Is a move-in fee the same as a security deposit?

A landlord might charge a “move-in fee” instead of a security deposit. This is not the same, and it is usually non-refundable; there are not the same protections for the tenant as a security deposit would have. If the move-in fee is about the amount of a month’s or two months’ rent, it could be considered a security deposit.

Can your security deposit be the last month’s rent?

A security deposit does not serve as your last month’s rent in Illinois unless the landlord and tenant have agreed to this arrangement in writing. If the tenant owes rent, the landlord may serve a demand for rent and then pursue eviction proceedings. That could mean the tenant must move out before the end of the month.

What should you do about an Illinois security deposit dispute?

Typically, a security deposit dispute is handled in Illinois small claims court, in which either the landlord or the tenant may file a lawsuit for up to $10,000. 

However, there are some steps you can take before filing a lawsuit:

Communicate with your landlord

Sometimes, what seems like a serious issue is really just a misunderstanding, especially in a landlord-tenant dispute, where clear communication can often resolve the problem before it escalates.

Contact your landlord or the property manager to discuss the issue and figure out if you can work together to resolve it. Make notes of your conversations and maintain any paper or electronic communications (i.e. texts or emails) so you’re saving a “paper trail” in case you need it later.

Make your claim

Let them know why you believe you’re entitled to a return of your full security deposit.

Provide evidence

You might need to show photos to demonstrate the property’s condition before and after your tenancy. Share them with the landlord to make your case. Understand that landlords can only deduct costs for damages that go above and beyond normal wear and tear.

Send a demand letter

You might need to write a demand letter that sets forth your concerns and demands return of your deposit. 

If none of these tactics can help you reach a mutually agreeable resolution, you might need to either file a lawsuit in small claims court or seek the guidance of an Illinois landlord-tenant attorney.