Security deposit interest in South Dakota
No — South Dakota does not require landlords to pay interest on security deposits.
There is no interest to calculate — here is what does apply
South Dakota 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
21 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 South Dakota'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 S.D. Codified Laws Sec. 43-32-6.1 and 43-32-24. 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 South Dakota law actually say?
South Dakota does not require landlords to pay interest on residential security deposits. The statute contains no interest provision and imposes no escrow or separate account requirement. Deposits are capped at one month's rent, though a larger deposit may be agreed between the parties where special conditions pose a danger to maintenance of the premises.
Within 21 days of termination and receipt of the tenant's mailing address or delivery instructions, the landlord must return the deposit or furnish a written statement giving the specific reason for withholding any portion. Withholding is limited to amounts reasonably necessary to remedy tenant defaults in rent and other funds due under the agreement, and to restore the premises to their condition at the start of the tenancy, ordinary wear and tear excepted. On the tenant's request the landlord must provide an itemised accounting of anything withheld within 45 days of termination.
This section was amended in 2026, shortening the previous return period.
What if your landlord does not comply?
No interest obligation, so no interest penalty. A landlord who fails to comply with the return or statement requirements forfeits all rights to withhold any portion of the deposit. Bad faith retention, or bad faith failure to provide the written statement or itemised accounting, subjects the landlord to punitive damages not exceeding 200 dollars.