Does a landlord have to pay interest on a security deposit in Idaho?
Idaho does not require landlords to pay tenants interest on a security deposit, and the word "interest" does not appear anywhere in Idaho's deposit statute.
Cited to Idaho Code § 6-321 (security deposits; third-party manager account duty) (1), (2), (4) and 1 more cited source · Verified August 28, 2026
The account rule that circulates under Idaho's name is narrower than the claim in two separate ways. It applies only where the residential premises is managed by a third-party manager, and it then carves out the property owner, managers sharing members or principals with the owner entity, real estate licensees, and nonprofit business organizations — so a self-managing Idaho landlord has no account duty at all. And what it requires is a separate account at a federally insured financial institution, kept apart from the manager's operating account: separate and insured, not interest-bearing. Reporting Idaho as a state that requires deposits to be held in interest-bearing accounts is wrong about the scope of the rule and wrong about the kind of account it names.
Idaho deposit interest at a glance
| Interest owed to the tenant | No — no statute addresses it |
|---|---|
| How the rate is set | No rate exists — there is no interest duty |
| Current figure | No published figure exists |
| Rate rules | No rate rules — no duty exists |
| Accrual and payment | No payment duty exists |
| Who and what is covered | No statutory conditions stated — see the summary and notes |
| Statute controls where or how the deposit is held | Yes |
| Interest-bearing account required | No statute addresses whether the account must bear interest |
| Custody rules | Idaho's only deposit-custody rule reaches third-party managers, not landlords generally. Idaho Code § 6-321(4) provides that "a security deposit for a residential rental premises that is managed by a third-party manager of a landlord shall be maintained in a separate account at a federally insured financial institution", and that "[s]uch account shall be maintained separate from the third-party agent's operating account". The same subsection then excludes four categories from the requirement: a property owner; managers who have common members or principals of the property-owner entity; a real estate licensee; and a nonprofit business organization established under chapter 30, title 30, Idaho Code. A landlord who manages his or her own units therefore has no account duty at all. What the subsection requires is that the account be separate and federally insured — it says nothing about the account bearing interest and nothing about earnings, and the word "interest" does not appear in § 6-321 in any sense. |
| Penalty for violation | No statutory penalty reaches an interest violation specifically |
| Local rules | None noted for this state |
Cite this page: "Landlord Atlas, Idaho Security Deposit Interest Laws (verified August 28, 2026), landlordatlas.com/laws/deposit-interest/idaho/" — free to cite and quote with a link (how these records are verified). Everything above is cited in the citations section below.
Check the verified Idaho answer — and every state and city that differs — in the deposit interest calculator — free, no signup, built on the same verified Idaho law as this page.
Notes and caveats
- The subsection, and its four carve-outs — Section 6-321(4) reads: "A security deposit for a residential rental premises that is managed by a third-party manager of a landlord shall be maintained in a separate account at a federally insured financial institution. Such account shall be maintained separate from the third-party agent's operating account. The requirements of this subsection shall not apply to a property owner, managers who have common members or principals of the property owner entity, a real estate licensee, or a nonprofit business organization as established under chapter 30, title 30, Idaho Code."
- Two errors in one claim — A source that reports Idaho as requiring deposits in an interest-bearing account has made two independent mistakes: it has taken a rule that binds paid third-party managers and applied it to all landlords, and it has turned an anti-commingling requirement into a yield requirement. Subsection (4) was added in 2021 to keep managers' client money out of their operating accounts. Idaho has never enacted a deposit-interest duty.
- What the rest of the section does — Subsection (1) treats as a security deposit any amount a tenant deposits for a purpose other than rent, and requires that on termination and surrender all amounts held as a deposit be refunded except those needed to cover the contingencies specified in the deposit arrangement, with nothing retained for normal wear and tear, which the subsection defines. Subsection (2) sets refunds at 21 days if no time is fixed by agreement and 30 days in any event, and requires any partial refund to be accompanied by a signed statement itemizing what was retained, why, and a detailed list of expenditures made from the deposit. Subsection (3) makes a new owner liable for the refund. The obligation throughout is to return the deposit itself.
- Currency — Section 6-321 was added in 1977 (ch. 45, sec. 5) and amended in 2021 (ch. 197, sec. 1), which added subsection (4); subsections (1) through (3) are 1977 text. Idaho statutes are published as updated on July 1 following each legislative session. The 2026 session's only landlord-and-tenant entry is a writ-of-restitution measure, House Bill 695, chapter 82, and the session index contains no reference to § 6-321 and none to security deposits.
Common questions: Idaho deposit interest
Each answer is the verified value from the table above, restated as a direct answer. Free to quote with a link to this page.
- What is the Idaho security deposit interest rate right now?
- No published figure exists.
- When must a landlord pay or credit deposit interest in Idaho?
- No payment duty exists.
- Does the deposit have to be in an interest-bearing account in Idaho?
- No statute addresses whether the account must bear interest. Idaho's only deposit-custody rule reaches third-party managers, not landlords generally. Idaho Code § 6-321(4) provides that "a security deposit for a residential rental premises that is managed by a third-party manager of a landlord shall be maintained in a separate account at a federally insured financial institution", and that "[s]uch account shall be maintained separate from the third-party agent's operating account".
- What happens if a landlord does not pay deposit interest in Idaho?
- No statutory penalty reaches an interest violation specifically.
- Do any cities or counties in Idaho have their own deposit-interest rules?
- None noted for this state.
Citations
- Idaho Code § 6-321 (security deposits; third-party manager account duty) · (1), (2), (4) (verified 2026) Official source
- Idaho Code title 6, chapter 3 (section index) (verified 2026) Official source
How this record was verified: Direct read of Idaho Code § 6-321, "Security deposits", in full — all four subsections and the history line — on the Legislature's statute service, together with the section index for title 6, chapter 3, read in full; the § 6-321 page searched for "interest", "escrow", "trust" and "accrue", which return no occurrence of any kind anywhere on the page including the history line; and the Legislature's 2026 session subject index read under "Landlords and tenants", whose sole entry is a writ-of-restitution measure, with the whole 2026 index containing no reference to § 6-321 and none to security deposits.