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Iowa City, IA Rental Property Rules: Security Deposit Rules (2026)

Some Restrictions
Compiled from the official code textEditor Martyn O'NeillLast verified September 2026

Key Facts

Maximum Deposit
2 months' rent (562A.12(1))
Return Deadline
30 days (562A.12(3))
Account Rule
Federally insured, no commingling
Bad-Faith Penalty
Actual + up to $200 punitive
Forum
Johnson County small claims

Summary

Iowa City security deposits follow the Iowa URLTA. Iowa Code 562A.12 caps the deposit at two months' rent, requires return or written itemized deductions within 30 days of tenancy termination and receipt of the tenant's forwarding address.

A landlord shall not demand or receive as a security deposit an amount or value in excess of two months’ rent. 2. All rental deposits shall be held by the landlord for the tenant, who is a party to the agreement, in a bank or savings and loan association or credit union which is insured by an agency of the federal government.

View official code

Full Breakdown

Iowa Code 562A.12 governs every Iowa City residential security deposit. The landlord may not demand or receive a deposit greater than two months' rent. The deposit must be held in a federally insured bank, savings and loan, or credit union and may not be commingled with the landlord's personal funds. Within 30 days from termination of the tenancy and receipt of the tenant's mailing address, the landlord must return the deposit or send a written statement of the specific reason for any withholding. Bad-faith retention authorizes recovery of actual damages and punitive damages of up to $200 under 562A.12(7).

Violations & Fines

Demanding more than two months' rent, failing to return or itemize within 30 days, or commingling deposits violates Iowa Code 562A.12. Bad-faith retention exposes the landlord to actual damages plus punitive damages up to $200 in Johnson County small-claims court.

Frequently Asked Questions

How much security deposit can an Iowa City landlord charge?
No more than two months' rent under Iowa Code 562A.12(1). The cap applies to every residential rental governed by the Iowa URLTA, including student rentals near the University of Iowa.
When must my Iowa City landlord return my deposit?
Within 30 days after termination of tenancy and receipt of your mailing address, the landlord must return the deposit or send a written statement of the specific reason for withholding, per Iowa Code 562A.12(3).
What if my landlord wrongfully keeps my deposit?
Sue in Johnson County small-claims court. If the landlord retained the deposit in bad faith, Iowa Code 562A.12(7) allows actual damages plus punitive damages of up to $200.

Sources & Official References

Other rules in Iowa City

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All Iowa City rules

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