Section 1950.5 is the whole of California’s security deposit law in one long statute. Most landlords only ever read the cap and the 21-day deadline. The parts in between are where deposits are actually lost.
This walk-through follows the statute’s own order, as amended through AB 414 (effective January 1, 2026).
(b): what security is, and what it can pay for
Security is any payment, fee, deposit, or charge imposed at the start of the tenancy, including advance rent, other than the application screening fee. It can be used for four things only:
- Unpaid rent.
- Repair of damage beyond ordinary wear and tear, caused by the tenant or a guest.
- Cleaning needed to return the unit to the level of cleanliness it had at move-in.
- Restoring or replacing personal property or appurtenances, if the lease allows it.
Nothing else. The cap on how much you can collect is in subdivision (c), covered in detail in the AB 12 cap explained.
(e): the limits on what you can claim
You can only claim what is reasonably necessary for those four purposes. Then the statute rules out three things by name: damage or defects that were there before the tenancy, ordinary wear and tear, and the cumulative wear of one or more tenancies.
Since AB 2801, two more limits apply. Charges for materials, supplies, and labor are capped at a reasonable amount to restore the unit to its move-in condition. And you cannot charge for professional carpet cleaning or other professional cleaning unless it is reasonably necessary to get back to that condition.
Where wear ends and damage begins is the most argued line in the statute. Normal wear and tear vs damage works through the common cases.
(f): the initial inspection
This one is an obligation, not a courtesy. Within a reasonable time after either side gives notice to end the tenancy, or before the lease term ends, you must tell the tenant in writing that they can ask for an initial inspection and be present for it.
If they ask:
- The inspection happens at a reasonable time, no earlier than two weeks before the tenancy ends.
- You give at least 48 hours’ written notice of the date and time, unless both of you sign a waiver.
- You go ahead whether the tenant is there or not, unless they withdrew the request.
- You leave an itemized statement of the repairs and cleaning you propose to deduct for, along with the text of paragraphs (1) to (4) of subdivision (b).
The tenant then has until move-out to fix those items. If the unit was clear enough to inspect, you cannot later deduct for something you could have listed and did not. Damage that happens after the inspection, or that was hidden by the tenant’s belongings, is still fair game.
Why a pre-move-out walkthrough saves disputes covers how to run one.
(g): photos, before and after
AB 2801 added a photo requirement in two stages.
- Move-out, from April 1, 2025. Photograph the unit within a reasonable time after you get possession back, before any repairs or cleaning you plan to deduct for. Then photograph it again after that work is done.
- Move-in, for tenancies starting on or after July 1, 2025. Photograph the unit immediately before, or at the start of, the tenancy.
These photos go to the tenant with the itemized statement whenever you deduct for repairs or cleaning. Mail, email, a flash drive, or a link all work. A tenancy that began before July 2025 will not have statutory move-in photos, which makes a dated move-in checklist matter more, not less. Documenting move-in condition with photos and video has a shot list.
(h): the 21 days
No later than 21 calendar days after the tenant has vacated, you send an itemized statement of the security received and what happened to it, and you return whatever is left.
How the money goes back. By personal delivery or a check mailed first class. If the tenant paid the security or rent electronically, the refund goes back electronically to an account the tenant designates in writing, unless the two of you agreed in writing on another method. With several adult tenants and no written agreement among all of them, the check is made out to all the adult tenants on the lease.
What goes with the statement. Each deduction for repairs or cleaning needs support:
| Who did the work | What the tenant gets |
|---|---|
| You or your employee | A reasonable description of the work, the time spent, and the hourly rate |
| A contractor | A copy of the bill, invoice, or receipt, plus their name, address, and phone if the invoice lacks them |
| Materials or supplies | A copy of the bill, invoice, or receipt (a vendor price list works for items you buy regularly) |
Plus the photos from subdivision (g).
Work that is not finished in time. If a repair cannot reasonably be done within the 21 days, or a vendor’s invoice has not arrived, you can deduct a good faith estimate and say so on the statement. Within 14 calendar days of finishing the work or receiving the paperwork, you send the final documents.
The $125 line. You can skip the documents when repair and cleaning deductions together are $125 or less, or when the tenant signed a waiver that substantially includes the text of paragraph (2), at or after a notice to end the tenancy or within 60 days of a fixed-term lease’s end. Even then, if the tenant asks for the documents within 14 days of getting the statement, you have 14 days to send them.
Where to send it. To the address the tenant gave you. With no address, mail it to the unit they vacated. What to do when a tenant leaves no forwarding address covers that situation. A landlord who fails to comply with this subdivision in bad faith loses the right to claim any of the security at all (§ 1950.5(h)(7)).
(i) to (k): selling the building
When your interest in the property ends, by sale or otherwise, you either transfer the remaining security to the new owner and notify the tenant, or refund it to the tenant with an accounting. Before a voluntary sale, you give the buyer a written statement of the security held and any deductions. If you skip this, the buyer can end up jointly liable for the deposit.
(m) to (o): what goes wrong costs
- Bad faith. Bad faith claims or retention can bring statutory damages of up to twice the amount of the security, on top of actual damages. A court can award them even if the tenant did not ask. The landlord carries the burden of proving the amounts were reasonable.
- No “nonrefundable.” A lease cannot call any security nonrefundable.
- Small claims. A tenant can sue in small claims court when the amount is within its limits.
Putting it on a calendar
The statute runs on dates: the inspection notice, the two-week window, possession, day 21, and the 14-day follow-ups. Deposit tracking keeps those dates, the photos, and the receipts on the tenancy record, and the security deposit calculator checks the amount you collected against the cap.
This is general information, not legal advice. Rules change and local ordinances vary. Confirm current requirements with your city, county, or an attorney before you act.