What are the security deposit rules in Iowa?
Iowa caps security deposits at two months' rent and gives landlords 30 days to return the deposit or deliver a written statement of specific reasons for keeping any of it — but the 30-day clock runs from the later of the tenancy ending and the landlord receiving the tenant's mailing address or delivery instructions, so a tenant who never provides an address never starts the clock, and one who waits more than a year forfeits the deposit entirely.
Deductions are limited to unpaid rent and charges, damage beyond ordinary wear and tear, and the cost of recovering possession from a bad-faith holdover, with the burden of proof on the landlord. A landlord who misses the 30-day statement deadline forfeits the right to withhold anything, and bad-faith retention adds punitive damages of up to twice the monthly rent on top of actual damages — the '$200 penalty' still quoted by many guides was repealed from this chapter in 2013 and now survives only in Iowa's separate mobile-home law. Deposits must sit in a federally insured, non-commingled account; interest is optional, and whatever interest accrues during the first five years belongs to the landlord.
Iowa security deposits at a glance
| Maximum deposit | 2 months' rent |
|---|---|
| Return deadline | 30 days |
| Deadline conditions | Within 30 days from the LATER of two triggers: the date of termination of the tenancy AND the landlord's receipt of the tenant's mailing address or delivery instructions (562A.12(3)(a)). The clock does not start at move-out if the tenant has not supplied an address. Balancing rule: if the tenant provides no mailing address or instructions within one year from termination, the deposit reverts to the landlord and the tenant is deemed to have forfeited all rights to it (562A.12(4)). |
| Itemization required | Yes |
| Itemization rules | Within the 30-day window the landlord must either return the deposit or furnish a written statement showing the specific reason for withholding any portion; if withholding is for restoration of the unit, the statement must specify the nature of the damages (562A.12(3)(a)). Withholding is limited to three grounds: unpaid rent or other funds due under the rental agreement; restoring the unit to its start-of-tenancy condition, ordinary wear and tear excepted; and expenses of recovering possession from a tenant who fails in bad faith to surrender the premises. In any deposit action the landlord bears the burden of proving the reason for withholding by a preponderance of the evidence (562A.12(3)(b)). |
| Separate account required | Yes |
| Interest owed to tenant | No |
| Account & interest rules | Deposits must be held for the tenant in a federally insured bank, savings and loan, or credit union and must not be commingled with the landlord's personal funds; they may be held in a common trust account which may be interest-bearing (562A.12(2)). Interest is not required — but if interest is earned, any interest during the FIRST FIVE YEARS of a tenancy is the landlord's property, which by negative implication makes interest earned after year five the tenant's. Contrast the mobile-home chapter, 562B.13(2), where the landlord keeps all interest with no five-year limit — a frequent cross-chapter confusion. |
| Pet deposits | No separate pet-deposit statute. A pet deposit is part of the 'security deposit' subject to the aggregate two-months'-rent cap of 562A.12(1) and the same 30-day return, itemization, and penalty rules. |
| Non-refundable fees allowed | Not addressed by statute |
| Penalty for violation | Two-tier: (1) a landlord who fails to provide the written statement within 30 days of termination and receipt of the tenant's address forfeits all rights to withhold any portion of the deposit (562A.12(4)); (2) BAD-FAITH retention of any portion subjects the landlord to punitive damages not to exceed twice the monthly rental payment, in addition to actual damages (562A.12(7)). The court may award reasonable attorney fees to the prevailing party in any action on a rental agreement (562A.12(8)). |
| Tenant forwarding-address duty | Practical duty with a hard sanction: the 30-day return clock does not begin until the landlord receives the tenant's mailing address or delivery instructions, and a tenant who provides neither within one year of termination forfeits the entire deposit to the landlord (562A.12(3)(a), (4)). |
Notes and caveats
Statute citations
- Iowa Code 562A.12 (1)-(8) Official source
How this record was verified: Direct read of statute text on the official Iowa Legislature site (legis.iowa.gov), Iowa Code 2026 section PDFs: 562A.12, 562A.9, 562A.13, 562A.19, 562A.34, and 562A.35 each read twice — official PDF plus independent FindLaw mirror stated current as of 2026-01-01 — with every load-bearing figure matching verbatim (2-month deposit cap, 30-day return clock and its dual trigger of termination plus receipt of the tenant's mailing address or delivery instructions, first-5-years deposit interest to landlord, 1-year forwarding-address forfeiture, punitive damages capped at twice the monthly rental payment, $700 late-fee threshold with $12/day-$60/month and $20/day-$100/month tiers, 30-day written rent-increase notice, 24-hour entry notice, 30-day month-to-month termination notice, one-month's-rent damages floor for unlawful entry). Also read once (official): 562A.28 and 562A.29 (cross-referenced entry rights), 331.304 (county rent-control preemption), and chapter 562B sections 562B.10/562B.13/562B.14 for cross-chapter trap mapping. Rent-control preemption 364.3(9) verified against three official Code editions (2026, 2019, 2001) plus the 1999 edition negative check proving enactment by 2000 Acts ch 1083, not 2019. Pending-bill check 2026-07-10: 91st GA adjourned sine die 2026-05-03; SF 2225 (omnibus tenant bill: third late-fee tier at $1,400 rent, 180-day mobile-home rent notice) died in Senate Judiciary subcommittee; HF 481/482 (2025 mobile-home protections) also died; 2026 enacted housing bills (SF 2369 ADUs, SF 2448 HOA disclosure, SF 2472 FirstHome) touch none of the four topics.