Quick Answer
A security deposit refund letter tells your tenant how much of their deposit you’re returning and why, itemizing any deductions for damage, unpaid rent, or unpaid bills. Most states require this in writing within 14 to 60 days of move-out.
Below are three letter versions (full return, partial return, and no return), a separate receipt template for your records, and instructions for sending the money once the letter’s sent.
Why This Letter Matters
Getting a security deposit back is one of the most common landlord-tenant flashpoints. Independent research from RapidEye Research’s 2026 security deposit analysis found that 87% of renters pay a deposit, but only 42% get all of it back, and 40% challenge a landlord’s move-out deductions at some point. A clear, itemized refund letter is what keeps a routine deduction from turning into a dispute or a small-claims filing.
The letter also does double duty: it’s your documentation if a tenant disputes the amount, and it’s often required for a landlord insurance claim tied to move-out damage.
What to Include in Every Version
Regardless of how much you’re returning, a compliant letter needs:
- Landlord and tenant details: your name, the property address, and the tenant’s forwarding contact information
- Date: when the letter is written or sent
- Total deposit amount and what’s being returned: the full original amount, and the amount coming back
- Itemized deductions: each deduction listed separately with a dollar amount and a brief reason, for example normal wear and tear is not deductible, but unpaid rent, unsettled utility bills, or repair costs beyond normal wear are
- Supporting documentation: receipts, contractor quotes, or move-out photos referenced or attached
- Your deadline: most states require this notice within 14 to 60 days of move-out (RentRedi’s state landlord-tenant law guides cover the specific window and any interest requirements for each state)
- Signature: yours or your property manager’s
Security Deposit Refund Letter Templates
A single generic template rarely fits every move-out, so use whichever version below matches your situation:
Full return
[Your Name]
[Property Address]
[Your Contact Information]
[Date]
[Tenant’s Name]
[Tenant’s Forwarding Address]Dear [Tenant’s Name],
This letter confirms the return of your full security deposit of $[Total Amount] for [Property Address]. No deductions were made. You should receive this refund by [refund method] within [X] days, per our lease agreement and [state] law.
If you have any questions, contact me at [Your Contact Information].
Sincerely,
[Your Name]
Partial return (with deductions)
[Your Name]
[Property Address]
[Your Contact Information]
[Date]
[Tenant’s Name]
[Tenant’s Forwarding Address]Dear [Tenant’s Name],
This letter details the return of your security deposit for [Property Address].
Total Security Deposit: $[Total Amount] Deductions:
- Total Deductions: $[Total Deductions] Net Amount Returned: $[Net Amount]
Supporting documentation (receipts/quotes) is enclosed. You should receive this refund by [refund method] within [X] days.
Sincerely,
[Your Name]
No return (full withholding)
[Your Name]
[Property Address]
[Your Contact Information]
[Date]
[Tenant’s Name]
[Tenant’s Forwarding Address]Dear [Tenant’s Name],
After inspecting [Property Address] following your move-out, we are withholding the full security deposit of $[Total Amount] for the following reasons:
Supporting documentation is enclosed. If you have questions or wish to dispute this determination, contact me at [Your Contact Information] by [date].
Sincerely,
[Your Name]
Security Deposit Refund Receipt
A refund letter explains the deductions; a receipt is the short confirmation you and the tenant both keep for your records once the money has moved. Landlords searching for this page are increasingly looking for the receipt specifically, not just the letter, so keep both on hand.
Example of Refund Receipt
Property: [Property Address]
Tenant: [Tenant’s Name]
Date of Refund: [Date]
Amount Refunded: $[Net Amount]
Method: [ACH / check / other]
Reference/Confirmation #: [if applicable]This receipt confirms the security deposit refund described above was issued in full satisfaction of the amount owed per the itemized letter dated [Date].
[Landlord Signature]
[Tenant Signature, if collected]
Sending the Refund
Writing the letter is half the job. Most standard templates don’t address how the money gets there, which is often why landlords default to a paper check simply because it’s familiar. A refund can go out electronically instead.
RentRedi’s Send Money feature, for example, sends deposit refunds, along with vendor payments or owner distributions, via ACH for a flat $1 fee, which avoids the lost-check and cash-a-check-at-the-bank friction on both ends. Whatever method you use, keep the receipt above as your record that the funds moved and cleared.
Recap
A security deposit refund letter documents what you’re returning and why, using the full, partial, or no-return version that matches your situation. Pair it with a receipt once the money moves, and check your state’s specific deadline before sending either one.
FAQ
What is a security deposit refund letter?
It’s a written notice a landlord sends a tenant after move-out, stating the total deposit, any itemized deductions for damage or unpaid charges, and the net amount being returned. It protects both parties if the amount is ever disputed.
How long do I have to return a tenant’s security deposit?
Most states require 14 to 60 days after move-out, but the exact window, whether interest is owed, and what counts as timely notice all vary by state. Check your state’s specific landlord-tenant law before sending the letter so your timeline and deductions hold up if challenged.
Can I deduct for normal wear and tear?
No. Normal wear and tear, like faded paint or lightly worn carpet from ordinary use, isn’t deductible in any state. Deductions are limited to damage beyond normal use, unpaid rent, and unpaid utility bills the tenant was responsible for.
What if I’m withholding the entire deposit?
Use the no-return version of the letter, and itemize every deduction with supporting documentation (photos, repair quotes, or receipts) just as you would for a partial return. A blanket withholding with no itemization is what typically triggers disputes and small-claims filings.
Do I need a separate receipt, or does the letter cover it?
The letter explains the deductions; the receipt confirms the refund went out and was received. They serve different moments in the process, so keeping both on file gives you a complete, dated record if a tenant later disputes the amount, the timing, or whether payment happened at all.
Can I send the refund electronically instead of mailing a check?
Yes. Many landlords now send deposit refunds via ACH instead of a paper check, which typically settles faster and avoids the lost-check or cash-a-check delays tenants run into with a mailed payment. Whatever method you use, confirm the transfer with a dated receipt for your own records.
What if my tenant disputes the deductions?
Respond in writing with your itemized letter and supporting documentation: dated move-out photos, repair invoices, or contractor quotes. Most disputes get resolved once a tenant sees clear evidence behind each deduction. If it escalates further, your state’s landlord-tenant law outlines the small-claims process both sides would use.
Next Steps
- Pick the letter version that matches your situation (full, partial, or no return) and fill in your state’s specific deadline.
- Send the refund and log it with the receipt template above.
- Check your state’s landlord-tenant law guide for the exact return window and any interest requirements before you send.