Security deposit interest in Indiana
No — Indiana does not require landlords to pay interest on security deposits.
There is no interest to calculate — here is what does apply
Indiana sets no interest requirement, so there is no figure to work out. The rules below are the ones that decide whether you get your deposit back in full, which is usually the larger sum anyway.
Deadline to return your deposit
45 days after the tenancy ends.
Miss it and the consequences below start to apply.
What to do next
- Give your landlord a written forwarding address. Several states make the return duty conditional on it, and Indiana's rules are summarised below.
- Photograph the unit at move-out, dated, before you hand back the keys. The dispute is almost always about condition.
- If the deadline passes, put the request in writing and cite Ind. Code Sec. 32-31-3. Keep a copy of what you sent and when.
Not legal advice. This is general information, not legal advice. Security deposit laws change and vary by jurisdiction. Verify with the cited statute or consult a licensed attorney in your state before taking action.
What does Indiana law actually say?
Indiana does not require landlords to pay interest on residential security deposits. The statute contains no interest provision, imposes no escrow or separate account requirement, and sets no cap on the deposit amount. A security deposit may be used only for four purposes: to reimburse unpaid rent the tenant owes under the rental agreement or by law, to repair damage to the premises beyond ordinary wear and tear caused by the tenant, their guests or invitees, to pay utility or sewer charges the tenant was required to pay directly to the landlord, and to reimburse the landlord for the reasonable expense of removing and storing a tenant's property after eviction.
The landlord must give the tenant an itemised written notice of any damages claimed and the estimated cost of repair, together with any balance owed, within 45 days of termination and delivery of possession. The tenant must supply a written forwarding address; a landlord who has not received one is not liable under this chapter, and the deposit is forfeited if the tenant fails to provide an address within 45 days of vacating.
What if your landlord does not comply?
No interest obligation, so no interest penalty. Failure to provide the itemised notice within 45 days constitutes agreement that no damages are due and requires the landlord to remit the full deposit. A landlord who fails to comply is liable for the deposit plus the tenant's reasonable attorney fees and court costs. If damages exceed the deposit the landlord may recover the excess.