Illinois security deposit return

(a) Except as provided in subsection (b), a lessor of residential real property who has received a security deposit from a lessee to secure the payment of rent or to compensate for damage to the leased premises may not withhold any part of that deposit as reimbursement for property damage unless the lessor has, within 30 days of the date that the lessee vacated the leased premises or within 30 days of the date the lessee's right of possession ends, whichever is later, furnished to the lessee, by personal delivery, by postmarked mail directed to his or her last known address, or by electronic mail to a verified electronic mail address provided by the lessee, an itemized statement of the damage allegedly caused to the leased premises and the estimated or actual cost for repairing or replacing each item on that statement, attaching the paid receipts, or copies thereof, for the repair or replacement.

The "whichever is later" wording was added on January 1, 2024. A month-to-month tenant who gives short notice and leaves early may still have a right of possession running to the end of the notice period, and then your 30 days run from that later date (an unpublished 2026 appellate order applied it that way: Wilkin v. LJB Homes LLC, 2026 IL App (2d) 250182-U). The statement may go by email, but only to a verified email address the tenant gave you; the receipts that follow an estimate, and a full refund where no statement is sent, must go in person or by postmarked mail; the Act is silent on how a balance sent with a statement travels. Neither "vacated" nor "right of possession ends" is defined in the Act. The statute speaks of withholding "as reimbursement for property damage", and courts have held that a good-faith withholding for something else, such as unpaid rent, falls outside it; the safe practice is to itemize everything you keep, inside the 30 days.

If no such statement and receipts, or copies thereof, are furnished to the lessee as required by this Section, the lessor shall return the security deposit in full within 45 days of the date that the lessee vacated the premises, delivered in person or by postmarked mail directed to the last known address of the lessee or another address provided by the lessee.

This clock runs from the move-out date only. Unlike the statement clock, the text does not wait for the end of the tenant’s right of possession; some guides apply the later date here too, and no court has decided it. Count from the day after move-out: if the tenant left on June 1, day 45 is July 16. If day 45 falls on a weekend or an Illinois holiday, the state’s general time-counting statute (5 ILCS 70/1.11) would carry it to the next business day, but no Illinois court has applied that statute to this Act, so treat the strict date as your deadline. The refund goes in person or by postmarked mail; email is not one of the listed methods for the money. A landlord who misses the rules here must return the entire deposit, even where there was real damage, and can then sue the tenant for the damage separately (Verhaeg v. McElligott, 2026 IL App (5th) 250731, a September 2026 decision that may still change; Mallah v. Barkauskas, 130 Ill. App. 3d 815 (1985); Cross v. Mayer, 73 Ill. App. 3d 726 (1979)).

If the lessor utilizes his or her own labor to repair or replace any damage or damaged items caused by the lessee, the lessor may include the reasonable cost of his or her labor to repair or replace such damage or damaged items. If estimated cost is given, the lessor shall furnish to the lessee, delivered in person or by postmarked mail directed to the last known address of the lessee or another address provided by the lessee, paid receipts, or copies thereof, within 30 days from the date the statement showing estimated cost was furnished to the lessee, as required by this Section.

Estimates start a second clock. Mail or hand over the paid receipts within 30 days of the date you sent the estimate, or you must return the deposit: in one case receipts served three days late cost the landlord the whole deposit, and good faith was no excuse (Mallah v. Barkauskas, 130 Ill. App. 3d 815 (1985)). Receipts cannot go by email. A Chicago court has held that a photocopy of a check the payee never cashed is not a paid receipt (Boyer v. Buol Properties, 2014 IL App (1st) 132780, decided under the Chicago ordinance).

If a written lease specifies the cost for cleaning, repair, or replacement of any component of the leased premises or any component of the building or common areas that, if damaged, will not be replaced, the lessor may withhold the dollar amount specified in the lease. Costs specified in a written lease shall be for damage beyond normal wear and tear and reasonable to restore the leased premises to the same condition as at the time the lease began. The itemized statement shall reference the dollar amount specified in the written lease associated with the specific building component or amenity and include a copy of the applicable portion of the lease. Deductions for costs or values not specified in the lease shall otherwise comply with the requirements of this Section.

No Illinois statute defines normal wear and tear; the phrase appears once in the Act, in the lease-cost sentence above. Courts say a tenant must leave the unit in the condition it was in when they moved in, normal wear and tear excepted (Ikari v. Mason Properties, 314 Ill. App. 3d 222 (2000)), and one appellate court treated nail holes as normal wear and tear (Tobin v. McClure, 144 Ill. App. 3d 33 (1986)). From January 1, 2027, for leases entered into after that date (owner-occupied buildings of six or fewer units excepted), a new Illinois law bans charging tenants several kinds of fees, including one for routine maintenance and upkeep of the unit (765 ILCS 705/35); it is a fee law, not a deposit law, but a lease cleaning charge written to get around it will draw attention.

No lease hereafter executed or currently existing between a park owner and tenant in a mobile home park or manufactured home community in this State shall contain any provision: (a) Permitting the park owner to charge a penalty fee for late payment of rent without allowing a tenant a minimum of 5 days beyond the date the rent is due in which to remit such payment; (b) Permitting the park owner to charge an amount in excess of one month's rent as a security deposit;

The quoted cap is real law, and it is not your law unless you are a park owner leasing a mobile home, or a lot, in a park of five or more homes. For an ordinary apartment or house there is no statewide ceiling. A 2026 bill to cap deposits at one month’s rent (SB3530) stalled in the Senate. Two more state rules touch what you may charge: a landlord may charge a security deposit to cover restoring the property if a tenant removes an electric vehicle charging system they installed (765 ILCS 1085/35), and you may not charge a higher deposit to a tenant with a disability, or an extra charge for a guide, hearing or support dog beyond actual damage (775 ILCS 5/3-102.1, 5/3-104.1).

If the lessee fails to provide the lessor with a mailing address or electronic mail address, the lessor shall not be held liable for any damages or penalties as a result of the lessee's failure to provide an address.

On our reading, which no court has tested, this sentence protects you only from damages or penalties caused by the tenant’s failure to give an address: it does not suspend the clocks, it does not excuse a statement sent in bad faith, and it is not a right to keep the deposit. The text can also be read to apply where the tenant gave one kind of address but not the other. Either way, if the tenant gave you any address, including the unit itself as the last known address, plan on using it.

by personal delivery, by postmarked mail directed to his or her last known address, or by electronic mail to a verified electronic mail address provided by the lessee

"Verified" is not defined. Whether a mailed statement counts as furnished on the postmark date is not decided by any Illinois case; the statute’s use of "postmarked mail" suggests the postmark date matters, so keep proof of it. Chicago and Cook County ordinances say "deliver or mail" and do not mention email, and Mount Prospect requires certified mail or personal service.

A lessor of residential real property, containing 25 or more units in either a single building or a complex of buildings located on contiguous parcels of real property, who receives a security deposit from a lessee to secure the payment of rent or compensation for damage to property shall pay interest to the lessee computed from the date of the deposit at a rate equal to the interest paid by the largest commercial bank, as measured by total assets, having its main banking premises in this State on minimum deposit passbook savings accounts as of December 31 of the calendar year immediately preceding the inception of the rental agreement on any deposit held by the lessor for more than 6 months.

Count the units you hold in one building, or in one complex whose parcels touch; units owned by different owners are not added together (Munroe v. Brower Realty & Management Co., 206 Ill. App. 3d 699 (1990)), and a manager who signs leases as the lessor can be liable (Kutcher v. Barry Realty, Inc., 362 Ill. App. 3d 756 (2005)). Interest runs from the date of the deposit, but only once the deposit has been held more than six months; at exactly six months nothing is owed. Public housing is outside the Act. A lease clause waiving the interest is void (Wang v. Williams, 343 Ill. App. 3d 495 (2003)).

The lessor shall, within 30 days after the end of each 12 month rental period, pay to the lessee any interest that has accumulated to an amount of $5 or more, by cash or credit to be applied to rent due, except when the lessee is in default under the terms of the lease. The lessor shall pay all interest that has accumulated and remains unpaid, regardless of the amount, upon termination of the tenancy.

The rate is fixed by the year the rental agreement began: it is the figure the largest Illinois-headquartered bank paid on minimum-deposit passbook savings on December 31 of the year before. The Illinois Department of Financial and Professional Regulation publishes it each January, and since 2016 it has published two numbers: an interest rate (0.005% for leases beginning in 2026) and an annual percentage yield (0.01%). The Act does not say which to use and no court has decided it. Our calculator uses the yield, which is the higher figure, and shows the other beside it; on a $2,000 deposit the difference is about ten cents a year. Leases beginning in 2016 carry 0.045% (yield 0.05%). The $5 figure is a payment trigger, not a floor: interest builds up, and once the unpaid total reaches $5 at the end of a 12-month period it is due within 30 days. The willfulness penalty is an amount equal to the deposit, not twice it; whether a tenant can recover it once or once for each 12-month period missed has not been decided, and the one appellate court to touch it expressly left the question open (Dickson v. West Koke Mill Village Partners, 329 Ill. App. 3d 341 (2002)). An honest mistake about procedure is not willful (Inendino v. Equity Property Management, LLC, 2022 IL App (2d) 210447).

In the event of a sale, lease, transfer or other direct or indirect disposition of residential real property, other than to the holder of a lien interest in such property, by a lessor who has received a security deposit or prepaid rent from a lessee, the transferee of such property shall be liable to that lessee for any security deposit, including statutory interest, or prepaid rent which the lessee has paid to the transferor. Transferor shall remain jointly and severally liable with the transferee to the lessee for such security deposit or prepaid rent.

State law sets no notice deadline for an ordinary sale. A different rule covers mortgage foreclosures: a buyer at a foreclosure sale who actually receives the deposits is liable for them and must post a written notice on each unit’s main entrance within 21 days after the transfer and after receiving the tenant’s name and address (710/1.2). Chicago and Cook County add their own transfer notices.

a lessor of residential real property who has received a security deposit from a lessee to secure the payment of rent or to compensate for damage to the leased premises may not withhold any part of that deposit as reimbursement for property damage unless

Before 2024 the Act reached only residential property containing five or more units, and many guides, including the Illinois Attorney General’s own fact sheet, still say so. Three different thresholds get mixed up: the Return Act now has none, the Interest Act still starts at 25 units, and Chicago’s ordinance does not reach owner-occupied buildings of six units or fewer, which still owe state law. A mobile home, or a lot, leased from the owner of a park of five or more homes is governed by a different act (765 ILCS 745). Whether the 2024 change reaches a small landlord’s lease signed before 2024 is not settled; on our reading it applies to any withholding after January 1, 2024.

"Escrow moneys" includes, without limitation, earnest moneys and security deposits, except those security deposits in which the person holding the security deposit is also the sole owner of the property being leased and for which the security deposit is being held.

This is a licensing rule, enforced by the state against the licensee, not a tenant remedy. The escrow account must be non-interest-bearing unless interest is "otherwise required by law" (as under Chicago’s ordinance or the state Interest Act) or the parties require it in writing.

The landlord may not increase for persons with a disability any customarily required security deposit.

One narrow exception: where a tenant with a disability makes modifications at their own expense, and where that is necessary to ensure with reasonable certainty that funds will be available to pay for the restoration, the landlord may negotiate, as part of a restoration agreement, payments into an interest-bearing escrow account, over a reasonable period, of a reasonable amount not exceeding the cost of restoring the unit, with the interest going to the tenant. Federal fair-housing rules on assistance animals are outside what this page covers.

The park owner shall furnish the tenant, within 15 days after termination or expiration of the lease, an itemized list of the damages incurred upon the premises and the estimated cost for the repair of each item. The tenant's failure to object to the itemized list within 15 days shall constitute an agreement upon the amount of damages specified therein. The park owner's failure to furnish such itemized list of damages shall constitute an agreement that no damages have been incurred upon the premises and the entire security deposit shall become immediately due and owing to the tenant.

Parks regularly containing 25 or more homes also owe interest on deposits held more than six months, paid in cash within 30 days after each 12-month period, and must hold deposits in trust in an insured account. Unlike the general Return Act, a tenant who gives no forwarding address excuses the park owner from sending the list. Whether the Return Act’s 30- and 45-day clocks also apply to a deposit under this act has not been decided.