Security deposits underwent a significant change in Florida in 2023. A new law allows landlords not to charge a deposit but instead charge fees. While this charge creates more options, many landlords may still want to set a security deposit.
If you own rental Tampa real estate, these are five things you need to know about security deposits. That way, you can make an informed decision about managing your rental property.
1. There Is No Limit
Florida landlord/tenant law does not limit how much landlords can charge for a security deposit. While you can charge as little or as much as you want, consider the market conditions. You don't want to charge too much and struggle to find a tenant that can afford it.
Working with property management services in Tampa can help you determine an appropriate security deposit amount.
2. How You Hold the Deposit Matters
You can legally hold a tenant's security deposit in three ways. You can put it in a separate non-interest-bearing account. You can place it in an interest-bearing account for the tenant's benefit.
Finally, you can post a bond and pay the tenant 5% interest. When you hire a Tampa property management company, it can manage security deposit holdings for you.
3. They Might Be Income
You do not need to claim a security deposit as income on your taxes when the tenant pays it. You may need to return the security deposit, so the money is not yours yet.
However, the IRS does state that the security deposit becomes income when you keep it. This happens when the lease ends.
4. You Have Limited Time to Return
Florida landlords have 15 days to return a security deposit if they do not plan on keeping a portion or all of it. If you keep a part or all of the security deposit, you have 30 days to notify the tenant. You must do so in writing and by certified mail.
5. Pet Security Deposits Are Separate
You can charge a separate pet security deposit if you decide to allow pets in your rental property. These security deposits in Tampa are purely for damage caused by the tenant's pets. While Florida law does not limit how much you can charge, it is best to keep it reasonable.
There are exceptions to charging a pet deposit. You cannot charge a security deposit if the tenant has an emotional support or service animal. This would be considered discrimination under the Federal Fair Housing Act.
Get Help Managing Your Security Deposits
Charging security deposits for your rental properties helps you protect your investment. While there is no limit, it's best to keep it reasonable. You only have to report a security deposit as income when you keep it.
When you work with PMI JCM Realty Group, you have an experienced team of Tampa property managers helping you. We can advise you on an ideal security deposit amount and how to hold it during the lease term.
Protect your rental property by charging a security deposit with the assistance of PMI JCM Realty Group.
