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Illinois Security Deposit Law, in Plain English

For decades, Illinois' deposit statute skipped small landlords entirely. Not anymore: since January 2024 the Security Deposit Return Act reaches everyone — one condo or a hundred units — and inside Chicago a second, stricter rulebook applies on top. Here's how 765 ILCS 710 actually works, for both sides of the lease.

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30 / 45 daysItemized statement with receipts or estimates within 30 days; without a valid statement, the full deposit must be returned within 45
No capIllinois sets no statewide limit on deposit size
All lessorsSince January 1, 2024 the Return Act covers every residential lessor — PA 103-224 deleted the 5-unit threshold
25+ unitsLarger buildings owe interest on deposits held six months or more (765 ILCS 715)
2x + feesBad-faith failure to itemize or return on time: twice the deposit due, plus court costs and reasonable attorney's fees
Chicago RLTOCity rentals live under a stricter regime with its own receipt, interest, and 2x-penalty rules; main exemption is owner-occupied buildings of six units or fewer

No cap — and since 2024, no small-landlord exemption

Illinois sets no limit on how large a deposit can be; one to two months' rent is market practice, not law.

What changed recently is *who* the law reaches. Until 2024, the Security Deposit Return Act only applied to properties with five or more units — small landlords answered to nobody but the lease. Public Act 103-224 deleted that threshold effective January 1, 2024. The landlord renting out one house in Peoria now owes the same deadlines, and faces the same double-damages exposure, as a downtown high-rise operator. Plenty of small landlords haven't heard.

After move-out: itemize in 30 days or return everything in 45

If the landlord wants to keep any of the deposit for damage, an itemized statement must reach the tenant within 30 days of move-out, listing the damage and attaching paid receipts or cost estimates. If estimates were used, the paid receipts must follow within 30 days after the statement. The statement can be delivered in person, by postmarked mail to the tenant's last known address, or by email to a verified address the tenant provided.

No valid statement inside 30 days? Then the deduction machinery shuts off, and the full deposit must be returned within 45 days of move-out.

What can be deducted is the usual pair: unpaid rent, and repair of damage beyond normal wear and tear. Faded paint and carpet worn by ordinary walking stay the landlord's cost.

Thirty days to prove the damage. The record does the proving.

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PropInspect is a documentation tool, not a compliance service or legal-advice product. Using PropInspect does not guarantee compliance with Illinois law or a particular result in a deposit dispute.

Interest: a 25-unit rule statewide, an everyone rule in Chicago

Statewide, the separate Security Deposit Interest Act (765 ILCS 715) requires interest only from landlords of 25 or more units, on deposits held six months or more — at a rate pegged to the passbook savings rate of Illinois' largest commercial bank, paid in cash or rent credit within 30 days after each 12-month period.

Inside Chicago, interest is nearly universal (see below). And some suburbs — Evanston, for one — run their own ordinances. Illinois deposit law is genuinely address-dependent: check the city before assuming the state rules are the whole story.

Renting in Chicago? A second rulebook applies

Most Chicago rentals fall under the city's Residential Landlord and Tenant Ordinance (§ 5-12-080) — the main exemption is owner-occupied buildings of six units or fewer. On top of the state deadlines, the RLTO requires:

- A receipt for the deposit identifying who holds it; - The deposit kept in a federally insured, interest-bearing Illinois account, never commingled with the landlord's money; - Annual interest at the city-published rate (0.01% for 2026), paid within 30 days after each 12-month anniversary; - Itemization within 30 days and return within 45; - And for violations: two times the deposit in damages, plus attorney's fees. Chicago courts have applied that penalty even to technical misses — a late interest payment on a tiny rate can cost a landlord double the deposit.

The practical Chicago advice is blunt: many local attorneys tell landlords not to take a deposit at all — and if you do, to run the paperwork perfectly.

When it goes wrong: double damages and small claims

Statewide, a circuit-court finding that the landlord refused to supply the itemized statement — or supplied it in bad faith — and failed to return the deposit due makes the landlord liable for twice the deposit, plus court costs and reasonable attorney's fees.

Deposit fights typically land in the circuit court's small claims procedure, which handles claims up to $10,000 with simplified rules and modest county-set filing fees. The paper decides: the lease, the itemized statement or the silence where one should have been, receipts, and dated room-by-room photos from move-in and move-out.

Sources and official texts

The official sources for this guide are the Security Deposit Return Act, 765 ILCS 710 — deadlines, delivery methods, and bad-faith damages; Public Act 103-0224 — the amendment removing the five-unit threshold (effective January 1, 2024); the Security Deposit Interest Act, 765 ILCS 715 — the 25-unit interest rule; and the City of Chicago's official security-deposit interest rates page.

Frequently asked questions

How long does a landlord have to return a security deposit in Illinois?

If the landlord is deducting for damage: an itemized statement with receipts or estimates must arrive within 30 days of move-out (with paid receipts following within 30 days of the statement if estimates were used), and the balance follows. If no valid statement is delivered, the entire deposit must be returned within 45 days of move-out.

How much can a landlord charge for a security deposit in Illinois?

State law sets no cap — one to two months' rent is market practice, not a legal limit. Chicago's RLTO likewise sets no dollar cap, though it tightly regulates how the deposit is held and returned.

Does the Illinois deposit law apply to small landlords?

Yes — since January 1, 2024. Public Act 103-224 deleted the old rule limiting the Security Deposit Return Act to buildings of five or more units. A landlord renting a single house or condo now owes the same 30/45-day deadlines and faces the same penalties.

Do I get interest on my deposit in Illinois?

Statewide, only if your building has 25 or more units and the deposit is held six months or more — at a rate pegged to the largest Illinois bank's passbook savings rate. In Chicago, most rentals (except owner-occupied buildings of six or fewer units) earn interest annually at the city-published rate, which is 0.01% for 2026.

What can a landlord deduct from a deposit in Illinois?

Unpaid rent and the cost of repairing damage beyond normal wear and tear, documented in the itemized statement with paid receipts or estimates. Ordinary aging — faded paint, carpet worn by normal use — is not deductible.

What happens if the landlord blows the deadlines or fakes the statement?

If a court finds the landlord refused to supply the itemized statement or supplied it in bad faith and failed to return what's due, the penalty is twice the deposit, plus court costs and attorney's fees. In Chicago, the RLTO imposes two-times-the-deposit damages for violations of its deposit rules — courts have applied it even to technical misses like late interest.

What extra rules apply in Chicago?

Chicago's RLTO adds: a receipt identifying who holds the deposit, an unmingled federally insured Illinois account, annual interest at the city rate, itemization within 30 days, return within 45, and double-deposit damages plus attorney's fees for violations. The main exemption is owner-occupied buildings of six units or fewer. Some suburbs (like Evanston) have their own ordinances too.

Where do deposit disputes go in Illinois?

Small claims in the local circuit court handles disputes up to $10,000 with simplified procedure. Bring the lease, the itemized statement (or proof none arrived), receipts, and dated move-in and move-out photos — the statement deadlines make the paper trail decisive.

Walk the unit. The report's already done.

Photos, video and notes land in the right room as you go. Share one link before you're back at the office: the repair person sees what to fix, the tenant sees why, the owner sees everything.

Done at the door, not at your desk
One link for everyone. No account, no app.
Dated, room-by-room proof for when the deposit is due

First inspection free, then $0.99. No subscription.

Start an inspection See a sample report

PropInspect is a documentation tool, not a compliance service or legal-advice product.

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These state rules are not interchangeable. Read the guide for the state where the rental is located.