Tennessee Security Deposit Law 2026: Limits, Deadlines & Deductions
- Does the URLTA apply to my rental? § 66-28-301 sits inside Tennessee's Uniform Residential Landlord and Tenant Act, which applies only in counties that meet its population threshold. Confirm the Act covers your county and property type with a local…
- Is there really no deadline to return a Tennessee deposit? Correct — § 66-28-301 states no return period. The 30 days in subsection (g) limits when later-discovered damage can be charged, and the 60 days in subsection (f) is how long a landlord must wait before retaining an…
- What if the tenant skips the joint inspection? If the tenant was notified of the right to be present, scheduled an inspection, and failed to attend, the tenant waives the right to contest the findings — if the lease contains the required waiver notice. Tenants…
Tennessee is one of the few states with no cap on security deposits (Tenn. Code Ann. § 66-28-301) — and, read carefully, no statutory deadline for returning one either. What § 66-28-301 imposes instead is machinery: a dedicated deposit account with its location disclosed at signing, a joint move-out inspection on the day the tenant completely vacates or within 4 calendar days after, producing a signed, conclusive damage listing, and a refund-notice duty under which a refund the tenant never claims may be retained after 60 days. Skip the account or the listing and § 66-28-301(c) says you are not entitled to retain any portion of the deposit. Every section below is from the Tennessee Code Annotated.
The short version: Charge whatever deposit the market will bear — there is no legal maximum — but put all deposits in an account used only for that purpose, in a bank or other lending institution subject to state or federal regulation, and notify the tenant of the account's location when the lease is signed and the deposit is submitted (§ 66-28-301(a), (h)). Give the tenant notice of the right to be present at the move-out inspection, inspect on the day of complete vacatur or within 4 calendar days after, and sign the comprehensive damage listing together (§ 66-28-301(b)). There is no 30-day refund clock in the statute: the 30 days in § 66-28-301(g) is the window for discovering additional damage after the inspection. If the tenant leaves owing nothing with a refund due, send notification of the amount to the last known or reasonably determinable address; if there is no response within 60 days, you may retain it (§ 66-28-301(f)).
Tennessee has no refund deadline — but the 4-calendar-day joint inspection is the real trap — skip the account or the signed listing and you keep nothing under § 66-28-301(c). Track every clock with the Security Deposit Disposition & Deadline Tracker ($14.95).
The statute table
| Citation | What it says (one line) |
|---|---|
| Tenn. Code Ann. § 66-28-301 | Tennessee's security deposit statute, part of the Uniform Residential Landlord and Tenant Act (URLTA); sets no maximum deposit amount and no return deadline. |
| Tenn. Code Ann. § 66-28-301(a) | All tenants' deposits must be kept in an account used only for that purpose, in a bank or other lending institution subject to state or federal regulation. |
| Tenn. Code Ann. § 66-28-301(h) | The landlord must notify the tenant of the location of the account when the lease is signed and the deposit is submitted; the account number need not be provided. |
| Tenn. Code Ann. § 66-28-301(b)(1) | The tenant has the right to be present at the inspection, which must be on the day the tenant completely vacates or within 4 calendar days after; landlord's notice of that right may be given on requesting vacatur or within 5 days after receiving the tenant's written notice of intent to vacate. |
| Tenn. Code Ann. § 66-28-301(b)(1) | Landlord and tenant compile and sign a comprehensive listing of presently ascertainable damage with estimated repair costs; the signatures are conclusive evidence of accuracy, except for later-discovered damage under subsection (g). A tenant who refuses to sign must dissent in writing on specific items. |
| Tenn. Code Ann. § 66-28-301(b)(2) | A tenant who vacated without written notice, abandoned, was judicially removed, did not contact the landlord, failed to appear, or never requested a mutual inspection has no inspection right; the landlord inspects alone and sends a copy of the listing by certificate of mailing on the tenant's written request. |
| Tenn. Code Ann. § 66-28-301(c) | No landlord is entitled to retain any portion of a deposit if it was not deposited in the account subsection (a) requires and a listing of damages is not provided as subsection (b) requires. |
| Tenn. Code Ann. § 66-28-301(d) | A tenant disputing the listing may sue in circuit or general sessions court, limited to the items specifically dissented from in writing. |
| Tenn. Code Ann. § 66-28-301(e) | If the tenant vacates owing rent or other amounts due, the landlord may remove the deposit from the account and apply it to the unpaid debt. |
| Tenn. Code Ann. § 66-28-301(f) | If the tenant leaves not owing rent with a refund due, the landlord must send notification of the amount due to the last known or reasonably determinable address; after 60 days with no response, the landlord may retain it free of any claim. |
| Tenn. Code Ann. § 66-28-301(g) | Contractual damages remain recoverable, plus additional physical damage discovered after the inspection — but only if discovered before the earlier of 30 days after the tenant vacated or abandoned, or 7 days after a new tenant takes possession. |
| Tenn. Code Ann. § 66-28-301 (as a whole) | No statute requires interest on deposits; no statutory penalty multiplier for bad-faith withholding. |
Limits: how much can you charge?
No limit. Tennessee law sets no maximum security deposit, so the amount is a business decision — but a deposit of three or four times the rent invites disputes and bad reviews even if it is legal. Stay near local norms and put the amount in the lease.
There is no return deadline — here is what the statute requires instead
Read § 66-28-301 end to end and you will not find a sentence requiring return within 30 days, 60 days, or any other period. The widely repeated "30-day Tennessee return deadline" misreads subsection (g): that 30 days is the window for discovering additional damage after a completed inspection, not a refund clock. The end-of-tenancy rules that actually exist are:
- Apply it to unpaid debt (§ 66-28-301(e)). If the tenant vacates owing rent or other amounts due, you may remove the deposit from the dedicated account and apply it to that debt.
- Send the refund notice (§ 66-28-301(f)). If the tenant leaves not owing rent and a refund is due, send notification of the amount due to the tenant's last known or reasonably determinable address. If the tenant does not respond within 60 days of the sending, you may remove the deposit from the account and retain it free of any claim. The 60 days are not a licence to sit on a refund when you know where the tenant is: send promptly, document the mailing, and pay.
- Finish the deep inspection fast (§ 66-28-301(g)). Additional physical damage discovered after the inspection is recoverable only if discovered before the earlier of 30 days after the tenant vacated or abandoned, or 7 days after a new tenant takes possession. Re-renting quickly shortens the window, so the thorough inspection belongs in the first days after vacatur.
Use the Security Deposit Deadline Finder to calendar the inspection window and the damage-discovery date together.
The joint inspection, precisely
Tennessee's distinctive deposit feature is the inspection machine in § 66-28-301(b):
- Notice of the right to be present. Upon requesting that the tenant vacate, or within 5 days after receiving the tenant's written notice of intent to vacate, the landlord may notify the tenant of the right to be present at the inspection. The notice may advise the tenant to request an inspection time during normal working hours.
- Timing. The inspection is after the tenant has completely vacated and is ready to surrender possession and all means of access — either on the day of complete vacatur or within 4 calendar days after.
- The signed listing. On a mutual inspection, the parties compile a comprehensive listing of presently ascertainable damage behind any charge against the deposit, with estimated dollar costs, and both sign. The signatures are conclusive evidence of accuracy, except for later-discovered damage under subsection (g). A tenant who refuses to sign must state specifically in writing the items dissented from.
- The no-show waiver. A tenant who was notified, scheduled an inspection, and failed to attend waives the right to contest the landlord's findings — provided the rental agreement contains the required waiver notice.
- When there is no inspection right. The right does not apply where the tenant vacated without written notice, abandoned the premises, was judicially removed, did not contact the landlord after the notice, failed to appear, or has not requested a mutual inspection or is otherwise inaccessible (§ 66-28-301(b)(2)(B)). The landlord then inspects alone, compiles the same listing, and must provide a written copy, sent by certificate of mailing, on the tenant's written request.
Do not start repairs before the inspection: the listing covers damage ascertainable at inspection, and repairing first destroys its evidentiary value.
Deductions and the itemized list
Charges against the deposit must be tied to the comprehensive damage listing from the move-out inspection. Amounts owing under the rental agreement — unpaid rent and other amounts due (§ 66-28-301(e)) — and physical damage beyond normal wear and tear, at the estimated costs in the signed listing, are the standard categories. Damages discovered after the inspection can still be recovered, but only within the subsection (g) window above. Generate the paperwork with the Security Deposit Deduction Letter Generator.
Interest and where the money sits
No interest is required. But Tennessee does regulate where the money sits: § 66-28-301(a) requires all deposits to be held in an account used only for that purpose — one dedicated account holding all tenants' deposits, properly ledgered; the statute does not require a separate account per tenant — in a bank or other lending institution subject to state or federal regulation. Under § 66-28-301(h) you must notify the tenant of the location of that account at the time the lease is signed and the deposit submitted; you need not provide the account number. This is not optional paperwork — under § 66-28-301(c), the account and the damage listing are conditions of keeping any of the money.
The penalty, spelled out
Tennessee has no statutory multiplier (no 2x or 3x damages) for bad-faith withholding. The sanction is procedural and still expensive:
- Total forfeiture of retention — under § 66-28-301(c), no landlord is entitled to retain any portion of a security deposit if the deposit was not deposited in an account as subsection (a) requires and a listing of damages is not provided as subsection (b) requires.
- A limited tenant lawsuit — a tenant who disputes the listing may bring an action in circuit or general sessions court, but the claim is limited to the items specifically dissented from in writing (§ 66-28-301(d)).
In other words: the penalty is not a multiplier, it is losing the right to keep any of the deposit at all.
FAQ
Does the URLTA apply to my rental?
§ 66-28-301 sits inside Tennessee's Uniform Residential Landlord and Tenant Act, which applies only in counties that meet its population threshold. Confirm the Act covers your county and property type with a local attorney if you are unsure — outside a URLTA county, the lease and general law govern deposits instead.
Is there really no deadline to return a Tennessee deposit?
Correct — § 66-28-301 states no return period. The 30 days in subsection (g) limits when later-discovered damage can be charged, and the 60 days in subsection (f) is how long a landlord must wait before retaining an unclaimed refund after sending notification. Neither is a refund deadline, but prompt return after the inspection and listing is the practice the statute's machinery assumes.
What if the tenant skips the joint inspection?
If the tenant was notified of the right to be present, scheduled an inspection, and failed to attend, the tenant waives the right to contest the findings — if the lease contains the required waiver notice. Tenants who vacated without written notice, abandoned the unit, were judicially removed, never made contact, or never requested an inspection have no inspection right at all (§ 66-28-301(b)(2)); inspect alone and mail the listing by certificate of mailing on the tenant's written request.
Can I start repairs before the inspection?
No, not safely — the inspection must come after complete vacatur and before the listing is compiled, and the signed listing is conclusive evidence only for damage ascertainable at that inspection. Repair first and the damage list loses its evidentiary value.
Is there a limit on nonrefundable fees?
No statute addresses them separately. Label anything nonrefundable clearly in the lease; anything ambiguous tends to be treated as part of the refundable deposit.
What if the tenant won't give a forwarding address?
Mail the refund notification to the last known or reasonably determinable address (the rental unit if nothing better exists) and keep proof of mailing. The 60-day unclaimed clock in § 66-28-301(f) runs from that sending.
Can I keep the deposit for unpaid rent?
Yes — § 66-28-301(e) expressly allows the landlord to remove the deposit from the dedicated account and apply it to unpaid rent or other amounts due and owing, documented through the inspection and listing process.
Do I have to tell the tenant where the deposit is held?
Yes — the location of the dedicated account, at the time the lease is signed and the deposit is submitted (§ 66-28-301(h)). You do not have to provide the account number.
More security deposit guides
- Security deposit laws by state
- South Dakota security deposit law
- Texas security deposit law
- South Carolina security deposit law
- Utah security deposit law
Last verified: October 18, 2026. This is general information, not legal advice. Verify with a licensed Tennessee attorney before acting.