Rhode Island Security Deposit Laws

As a landlord, renting out your Rhode Island rental property comes with certain financial risks. However, requiring tenants to pay security deposits can help mitigate these risks and protect your bottom line.

At Lyon Property Management, we want to ensure that you’re equipped with the knowledge and understanding of how to handle a tenant’s deposit. By following Rhode Island’s landlord-tenant laws on security deposits, you can rest assured that your investment will be protected.

Here’s everything you need to know about handling a tenant’s security deposit.

1. Security Deposit Limit

In Rhode Island, there is a limit to how much landlords can charge tenants for the security deposit. The security deposit shouldn’t exceed one month’s periodic rent. If, for example, the rent is $1000, then you can not ask for an amount exceeding $1000 as a security deposit. 

2. Interest on Security Deposits

There is no law in Rhode Island that requires landlords to pay interest on the security deposit.


3. Security Deposit Deductions

As a landlord in Rhode Island, you may be able to make certain deductions on a tenant’s security deposit. The following are common examples. 

  • Unpaid Rent – Payment of rent is a key responsibility tenants have. At the time the tenant is moving out, they should not have any rent left to pay. If they do, and refuse to pay the leftover rent, then you can use part or all of their deposit to cover the unpaid rent. 
  • Reasonable Cleaning Expenses – A tenant must leave their rented premises in a reasonably clean condition. If they leave it unclean, you can hire expert cleaning services and deduct the money from their deposit. 
  • Reasonable Trash Disposal Expenses– A tenant is responsible for disposing of their own household waste. If they don’t, you can call garbage removal services and deduct the money from their deposit. 
  • Excessive Damage Expenses – You can hold a tenant liable for causing damage exceeding normal wear and tear. However, it’s important to understand what exactly qualifies as normal wear and tear versus damage in Rhode Island. 

What is considered normal wear and tear versus damage in Rhode Island? Rhode Island defines normal wear and tear as the day-to-day use and deterioration that occurs to a unit over time. Examples include stained bath fixtures, loose door handles, lightly scratched glass, and lightly dirtied grout. 

Damage, on the other hand, includes items such as missing fixtures, broken tiles, burned carpets, and holes in the wall. 


It goes without saying that you can hold a tenant liable for damages exceeding normal wear and tear. Just like in most states, there is no legal limit on how much a landlord can charge for damages, only that the costs must be within a reasonable amount. 

If the cost of fixing the damage exceeds the security deposit amount, you can seek additional damages from the tenant. 

4. Security Deposit as Last Month’s Rent 

Rhode Island law does not disallow tenants from using their security deposit as last month’s rent. However, landlords are allowed to make a provision in the lease agreement that prohibits a tenant from doing so. 

5. Security Deposit Refunds

You have 20 days to give the entire security deposit (or whatever amount remains after the deductions) back to the tenant after the end of their tenancy. 

If you have made deductions, you must provide the tenant with a written itemized notice of the damages incurred and the money it cost for each expense. You must mail this written notice to the tenant’s last forwarding address within this 20-day period.

The 20-day period begins once all the following three events have taken place. 

  • The lease agreement or rental agreement is terminated.
  • The tenant has delivered possession of the premises back to you. 
  • The tenant has provided you with a forwarding address. 

Also, according to state law, furniture deposits must also be refunded in the same manner.


6. Security Deposit Receipts

There is no law in Rhode Island that requires landlords to provide tenants with a receipt of the security deposit. Nonetheless, it’s still important for landlords to do so at the beginning of a tenancy.

Once you receive the deposit, make sure you provide the tenant with the following details. 

  • The security deposit amount you received. 
  • Your name and signature. 
  • The address of the unit. 
  • Date of the payment. 

7. Pet Deposits

Although Rhode Island prohibits charging a pet deposit in excess of what was described in Section 1, there is a way to protect your rental when you allow pets.

At Lyon, our strategy is to charge $50-75 additional per month when we approve a tenant with a pet. This would in turn increase your security deposit proportionately to the increase in rent described above. 

Based on our internal data, we have found that tenants with pets stay longer. Leveraging the methodology described above actually puts you, the landlord, in a better financial position over the long run because you will be receiving a higher monthly rent amount rather than a one time deposit.

It is illegal for landlords to charge tenants who have disabilities and require a service or support animal for a pet deposit. The Federal Fair Housing Act requires landlords to treat tenants who need service animals fairly. 

Bottom Line

When renting in Rhode Island, it’s important to familiarize yourself with these security deposit laws. If you have further questions or need expert help in managing your property, call Lyon Property Management!

We provide exceptional property management services for property owners in Rhode Island and Southern Massachusetts. Get in touch to get started right away!

Disclaimer: This blog should not be used as a substitute for legal advice from a licensed attorney in your state. Laws change, and this post might not be updated at the time of your reading. Please contact us for any questions you have in regards to this content or any other aspect of your property management needs.