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.
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).
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.
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