When can I keep a tenant’s security deposit?

Although Wisconsin Law gives the landlord broad authority to deduct rent and damages from a tenant’s security deposit, it also severely punishes landlords who don’t follow the appropriate rules.

If tenants leave or are evicted after their lease term ends, the landlord has 21 days from the day they learned the tenant moved to mail the tenant a security deposit withholding statement which itemizes all deductions made from the security deposit and returns the remaining portion. (If the tenant’s leave during the lease, the 21 days runs from the end of their lease or the day the landlord re-rents the unit, whichever comes first).

 Landlords can deduct all unpaid rent that the tenant legally owes from the security deposit. Landlords can deduct for damaged the tenants caused to the premises, but only if the damages are caused by “tenant misuse or neglect” and not “ordinary wear and tear.” The landlords can usually also deduct for utilities that tenants agreed to pay, but failed to. Landlords cannot, under any circumstances, deduct for routine cleaning charges. 

To make security deposit deductions without getting sued for it, do not delay. Itemize your deductions line by line and be reasonably specific. For example, you should write “February rent, $800, March rent, $800” instead of “unpaid rent-$1600.” Send a copy of the security deposit withholding statement to the tenant’s last known address, and make a record of when you mailed it. If it is returned as undeliverable, keep the envelope so that you can prove that you sent it if the tenant tries to sue you later.