For the "accidental landlord" in Fort Worth, the security deposit is your primary financial shield against property damage and unpaid rent. However, under the Texas Property Code, this money is legally considered the tenant's property until you prove a lawful claim to it.
Mismanaging a security deposit is the fastest way for a North Texas landlord to end up in a Tarrant County Justice Court facing "bad faith" penalties. This guide outlines the essential rules for collecting, holding, and—most importantly—returning deposits in accordance with Texas law.
1. Collection and Holding: The Texas Advantage
Texas is relatively landlord-friendly when it comes to the initial collection of deposits, but there are still best practices to follow:
- No Statutory Limit: Unlike many states that cap deposits at one month's rent, Texas law does not impose a maximum limit on what a landlord can charge for a security deposit. Most Fort Worth landlords stick to one month's rent to stay competitive, but you can request more if the tenant has a pet or a lower credit score.
- No Separate Account Required: In Texas, you are not required by law to keep security deposits in a separate escrow account or pay interest on them. However, for your own bookkeeping, we strongly recommend keeping these funds separate from your personal operating cash to ensure the money is available when the tenant moves out.
- Pet Deposits vs. Fees: Be careful with terminology. A deposit is refundable by nature. A non-refundable fee (like a move-in fee or a one-time pet fee) must be clearly labeled as such in the lease agreement.
2. The 30-Day Clock: A Non-Negotiable Deadline
The most critical rule for any Fort Worth landlord is the 30-day return window (Texas Property Code § 92.103).
- The Deadline: You must refund the deposit—or provide a written, itemized list of deductions—on or before the 30th day after the tenant surrenders the premises.
- Two Requirements to Start the Clock: 1. The tenant must have officially moved out and returned the keys.2. The tenant must provide you with a written forwarding address.
- The "Bad Faith" Penalty: If you miss this deadline without a valid excuse, you are presumed to have acted in "bad faith." A tenant can sue you for three times the amount wrongfully withheld, plus $100 and attorney’s fees.
3. "Normal Wear and Tear" vs. Damage
This is where most landlord-tenant disputes in Tarrant County begin. You cannot deduct for "normal wear and tear"—deterioration that results from the intended use of the home.
| Not Deductible (Normal Wear) | Deductible (Actual Damage) |
| Faded paint or minor scuffs | Large holes in drywall or "unauthorized" paint colors |
| Worn carpet in high-traffic areas | Pet urine stains or cigarette burns in carpet |
| Dusty blinds or loose doorknobs | Broken windows or missing fixtures |
| Minor grout discoloration | Clogged drains caused by grease or foreign objects |
Pro-Tip: Always use a Move-In/Move-Out Inventory & Condition Form. Take 50–100 time-stamped photos before a tenant moves in. Without "before" photos, it is nearly impossible to prove damage in court.
4. The Itemization List: Be Specific
If you withhold even one dollar from the deposit, Texas law (§ 92.104) requires you to provide a written, itemized list of all deductions.
- Don't Generalize: Never just write "Cleaning: $200." Instead, be specific: "Professional deep clean of kitchen appliances and master bath: $200."
- Provide Receipts: While not strictly required by the code to be sent with the list, having receipts or invoices ready is vital if the tenant disputes the charges.
- Labor Costs: If you do the work yourself, you can generally only deduct for the cost of materials. Most judges are skeptical of landlords charging high hourly labor rates for their own time.
5. New for 2025: Communication Updates
As of late 2025, Texas law has modernized communication. You may now provide the security deposit accounting via email, provided that you and the tenant have previously used email to communicate about the lease. However, sending a certified mail copy to the forwarding address remains the "gold standard" for proving you met the 30-day deadline.
By treating the security deposit with the strictness the Texas Property Code requires, you protect yourself from expensive litigation and maintain a professional reputation in the Fort Worth rental market.