What are the security deposit rules in Minnesota?

Verified July 9, 2026 All Minnesota topics →

Check your municipality. Minnesota does not preempt local rent regulation — city or county ordinances may impose rent caps, notice rules, and fee limits that are stricter than the state-level rules on this page and are not covered here. Verify your municipality's ordinances before relying on any figure below.

What the state record says

No statewide rent control. Minn. Stat. 471.9996 subd. 1 bars any city, county, or town from adopting or renewing rent control on private residential property — EXCEPT that subd. 2 expressly permits it if the ordinance, charter amendment, or law is approved in a GENERAL ELECTION (full text read twice, including the Revisor's official PDF). The exception is live, not theoretical: St. Paul voters approved a 3% annual rent-stabilization cap in November 2021 (effective May 2022), which the city council has since narrowed — most recently on 2025-05-07 (4-3 vote, changes effective 2025-06-13) to permanently exempt units first receiving a certificate of occupancy after 2004-12-31. Minneapolis voters in 2021 authorized their council to draft a rent-stabilization ordinance, but none has been enacted.

Pending legislation — not yet law. The rules on this page reflect current law only. The following bill would change it if enacted:

SF 4171 (2026) — Laws of Minnesota 2026, chapter 81 — Enacted but NOT yet effective as of the verification date. Section 2 rewrites Minn. Stat. 504B.118 ('Payment of Rent'): landlords must give immediate written receipts for in-person cash rent (three business days otherwise), must offer a no-extra-fee alternative payment method when a digital rent-payment platform is not functioning, and are prohibited from taking any adverse action — expressly including assessing LATE FEES or filing an eviction — when rent goes unpaid because both the digital platform and the landlord's alternative method are down; violation is an affirmative defense requiring dismissal of an eviction plus attorney fees. Other sections bar naming minor children as eviction defendants (new 504B.2136, $300 minimum damages) and allow estimated final submetered/apportioned utility bills at move-out (216B.023, 504B.216). Once effective, the late_fees topic gains a statutory platform-outage exception layered on top of the 8% cap.Status: Passed Senate 67-0 (2026-04-20) and House 134-0 as amended (2026-04-30), Senate concurred 63-3, signed by the governor 2026-05-12 as Laws 2026 ch. 81; effective 2026-08-01 (eviction-related provisions apply to actions filed on or after that date). Incorporate into late_fees notes on the next verification pass after 2026-08-01. (checked 2026-07-09).

Minnesota sets no cap on the size of a residential security deposit, but the deposit earns 1% simple annual interest and must be returned — with interest and a written statement of any specific withholding reasons — within three weeks after the tenancy ends and the landlord receives the tenant's mailing address or delivery instructions (five days if the building is condemned).

Deductions are limited to unpaid rent or other money owed and restoring the unit to its move-in condition, ordinary wear and tear excepted. A landlord who misses the deadline or skips the itemization owes the withheld amount plus interest plus an equal penalty, and bad-faith retention adds punitive damages of up to $500 per deposit. When the building is sold, the deposit must be transferred to the new owner or returned to the tenant within 60 days. Tenants cannot legally treat the deposit as last month's rent.

Minnesota security deposits at a glance

Maximum deposit	No statutory cap
Return deadline	21 days
Deadline conditions	Minn. Stat. 504B.178 subd. 3: within three weeks (21 days) after termination of the tenancy AND after receipt of the tenant's mailing address or delivery instructions — the clock is conditioned on the landlord having somewhere to send the money, a condition most secondary sources omit. If the tenant must leave because the building is legally condemned, the deadline drops to five days from the date the tenant leaves. The landlord must return the deposit with interest or furnish the written withholding statement within that window.
Itemization required	Yes
Itemization rules	A landlord who withholds any portion must provide a written statement showing the specific reason for the withholding (504B.178 subd. 3). Withholding is limited to amounts reasonably necessary (1) to remedy tenant defaults in the payment of rent or other funds due to the landlord, or (2) to restore the premises to their condition at the commencement of the tenancy, ordinary wear and tear excepted.
Separate account required	No
Interest owed to tenant	Yes
Account & interest rules	Deposits bear simple noncompounded interest at ONE PERCENT per annum, computed from the first day of the next month following full payment of the deposit to the last day of the month in which the landlord in good faith complies with the return/itemization duty; interest amounts under $1 are excluded (504B.178 subd. 2, current text double-read 2026-07-09). No escrow or separate-account requirement accompanies the interest duty. Stale-source alert: the rate has stepped down over the decades (it was 3% for deposits held before 8/1/2003, 5.5% earlier still), and old 3% figures still circulate in fifty-state charts — current law is 1%.
Pet deposits	No separate pet-deposit statute. A refundable pet deposit is money held to secure performance and rides the 504B.178 scheme — same interest, same three-week return, same itemization.
Non-refundable fees allowed	Not addressed by statute
Penalty for violation	Failure to provide the deposit, interest, or the written withholding statement within the statutory window makes the landlord liable for the portion of the deposit withheld plus interest, PLUS a penalty in an equal amount — i.e., roughly double the wrongfully withheld sum (504B.178 subd. 4). Bad-faith retention additionally exposes the landlord to punitive damages of up to $500 for each deposit on top of the subd. 4 damages (subd. 7). Both figures double-read against current text 2026-07-09.
Tenant forwarding-address duty	The three-week return clock runs only after the landlord's receipt of the tenant's mailing address or delivery instructions (504B.178 subd. 3), so a tenant who never supplies one suspends their own refund. Separately, the tenant may NOT apply the deposit to the last month's rent — withholding final-period rent 'on the grounds that the deposit should serve as payment' is expressly prohibited (subd. 8).

Notes and caveats

Encoding decisions: max_deposit is null because 504B.178 imposes no amount cap anywhere (all subdivisions checked) — but LOCAL ordinances can and do cap deposits (Minneapolis limits deposits under its renter-protection ordinance, and St. Paul paired a proposed one-month cap with its May 2025 rent-control amendments), so page copy should say 'no STATE cap.' return_deadline_days=21 encodes the statutory 'three weeks'; render as 'three weeks (21 days)' to match statutory language. The receipt-of-mailing-address condition on the clock is encoded because most summaries state a bare 21-days-from-move-out rule. nonrefundable_fees_allowed is null: no statute squarely authorizes or bans nonrefundable move-in fees; anything held to secure performance is a refundable 504B.178 deposit however labeled, and 504B.120 (rewritten by 2023 ch. 52) separately requires ALL nonoptional fees to be disclosed in the lease and advertisements with a first-page 'Total Monthly Payment,' enforceable by treble damages and attorney fees. Transfer-of-building rule (60 days to transfer with notice or return, subd. 5-range) encoded in summary. Stale-source trap debunked: 3% interest figures from pre-2003 law still circulate; current rate is 1% (double-read).

Statute citations

Minn. Stat. 504B.178 subds. 2-8 Official source

How this record was verified: Direct read of statute text on the official Minnesota Revisor of Statutes site (revisor.mn.gov, Minnesota Statutes 2025 edition): Minn. Stat. 504B.178, 504B.177, and 504B.211 each fetched twice in independent calls — the 1% interest rate, three-week/five-day return deadlines, $500 bad-faith punitive cap, 8%-of-overdue-rent late-fee cap, 24-hour entry notice, 8:00 a.m.-8:00 p.m. window, and $500-per-violation entry penalty all matched verbatim across reads. 504B.135 and 471.9996 read twice each (HTML fetch plus the Revisor's official PDF read in full). 504B.147 and 504B.120 read once each. MN Attorney General landlord-tenant handbook (ag.state.mn.us) read for the 'one rental period plus one day' rent-increase derivation. 2026 enactment sweep on revisor.mn.gov: SF 4171 bill status and enrolled text read directly (Laws 2026 ch. 81, signed 2026-05-12, effective 2026-08-01 — flagged as pending, not incorporated, since the Statutes-2025 pages predate it); HF 3245 status read (died in House committee at sine die 2026-05-18, not flagged).