Indiana security deposit rules.
The Indiana rules for residential security deposits in plain English: how much can be charged, how fast it comes back, whether interest is owed, and what catches operators out.
Last reviewed · Statute: Ind. Code § 32-31-3 · Not legal advice
How much can be charged
No statutory limit on the deposit amount.
When it has to come back
Within 45 days of termination and receipt of forwarding address, with itemised deductions.
Interest
No interest is required.
Where the money has to sit
No segregation requirement.
What catches operators out
- A tenant who doesn’t supply a forwarding address forfeits the right to refund, but not the right to itemisation.
- Tenant may recover deposit, attorney’s fees, and other damages on bad-faith retention.
What this looks like with Standby in Indiana.
When a resident takes a Standby certificate there is no cash deposit to hold, so the cap, the return deadline and the interest rules above have nothing to attach to. You are covered up to the full deposit and draw on it when you need to.
When a resident pays cash instead, Standby handles that deposit under your lease and Indiana law, so your team is not tracking return deadlines by hand.
This page summarises the most common single-family and multifamily residential rule in Indiana. Furnished units, senior leases, mobile-home tenancies and short-term rentals can differ, and city ordinances may override the state default. Check the statute before relying on a figure for a specific lease.