California Security Deposit Return: Deductions and Letter

The 21-day deadline and how to count it

The deadline runs from the day the tenant moves out, not from the end date printed on the lease. Within 21 days the tenant must have both the itemized statement and the refund of the balance. Sending one without the other does not finish the job.

The safe habit is to count every calendar day, weekends and holidays included, and to treat the move-out day as day zero. Write down which date you used as move-out and why, especially when keys came back late or belongings were left behind. If you are unsure which date a court would use, pick the earlier one.

The amended statute also deals with returning a deposit electronically when the tenant paid it electronically. If your tenant paid by bank transfer or an app, read §1950.5 on how the refund should go back.

Twenty-one days is plenty, provided you don’t spend twenty of them waiting for the painter’s invoice. Book repairs and cleaning in the first week.

What a California itemized statement must include

California spells out the attachments. According to §1950.5(h), the statement must come with:

• Copies of the bills, invoices or receipts for each repair or cleaning charge.
• For work you or your employees did, a description of the work, the time it took and the hourly rate you charged.
• The photographs the statute requires (see the next section).

There is a small exception: when repair and cleaning deductions add up to $125 or less, you do not have to attach receipts, although the tenant can still ask for them. Keep them either way.

If a repair won’t be finished inside the 21 days, read subsection (h) of the statute before you send anything. This page doesn’t cover that case.

Photographs and the pre-move-out inspection

For tenancies that began on or after 1 July 2025, you must photograph the unit at or just before move-in. You also photograph it after move-out, and before and after any repair or cleaning you plan to charge for. A deduction with no matching before-and-after pictures is hard to defend.

You must also tell the tenant they can ask for an inspection before they move out. That visit can happen no earlier than two weeks before the tenancy ends, with 48 hours’ written notice. In practice it lets both of you see the same problems before the keys come back. For ordinary visits, California presumes 24 hours’ written notice is reasonable.

The move-in and move-out inspection checklist has a photo log, so photo numbers on the checklist can be quoted directly on the deduction sheet.

What you can and can’t deduct

The state rule we rely on here is short: no deductions for ordinary wear and tear. Faded paint after several years, light scuffs by door handles and carpet flattened along a walkway are the usual examples in practice. A cigarette burn, a broken blind or a hole in a wall usually is not wear and tear.

The statute also lists the purposes a deposit can be used for. This page doesn’t reproduce that list, so read the statute if you plan to deduct anything other than damage or cleaning.

Check the deposit figure too. A deposit generally may not exceed one month’s rent; small landlords (people owning no more than two properties with four units in total) may take two months’, but not from a service member. If you collected more, get advice before you write the letter.

What getting it wrong can cost

Keeping a deposit in bad faith can cost up to twice the deposit in statutory damages, on top of the tenant’s actual damages. Missing receipts, photos or the deadline makes good faith harder to show.

Anything you keep because the tenant broke the lease is income in the year you keep it. Note it in the rent ledger so it isn’t forgotten at tax time.

Filling in the sheet and letter for California

1. Open the Excel file and go to the Details tab. Enter the tenant names, property and unit, and the deposit held. Leave interest owed at 0 unless your city requires interest on deposits.
2. Type the move-out date, then type 21 in "Days your state allows to return or itemize". The "Return or itemize by" date fills itself in. Add the forwarding address.
3. On the Deductions tab, delete the EXAMPLE row. Add one row per item, with the room and what was wrong compared with the move-in photos and checklist.
4. In the Evidence column, give the before and after photo numbers and the invoice or receipt number. For work you did yourself, add the hours and your hourly rate, for example "3 h at $45, photos 18–21".
5. Set "Could be wear and tear?" honestly. Rows marked Y turn amber. In California, rewrite those with evidence that the damage goes beyond ordinary use, or delete them.
6. Check the total deductions and the refund due at the top of the sheet.
7. Open the Word letter. Copy each row into the itemized table, then fill in the totals table. Change the enclosure line to say receipts and photos are enclosed, unless your deductions total $125 or less.
8. Send the letter and refund by the "Return or itemize by" date. Keep a copy of everything you sent and proof of when it went.