Indiana Security Deposit Law: Deadlines & Penalties

Indiana landlords must return the security deposit, minus any lawful deductions, within 45 days after the rental agreement ends and the tenant delivers possession. Deductions are limited to unpaid rent, rent due for ending the lease early, damage beyond ordinary wear and tear, and unpaid utility or sewer charges the tenant owed under the lease.

There's an important condition: the landlord's duties don't start until the tenant provides a mailing address in writing. The landlord must then send an itemized list of damages, with the estimated cost of repair for each item, along with any balance owed. This letter includes your forwarding address so the 45-day period is clearly triggered.

A landlord who doesn't send the itemized notice within 45 days is treated as agreeing that no damages are owed, and must return the full deposit immediately. A tenant who sues can recover the deposit withheld plus reasonable legal fees and court costs. Indiana small claims dockets hear claims up to $10,000, and Marion County has its own township small claims courts.