Louisiana Security Deposit Law: What Landlords Can and Cannot Keep

Louisiana security deposit law is short, specific, and unforgiving of landlords who ignore it. Get it right and the deposit does exactly what it is supposed to do — protect you. Get it wrong and you can end up owing the tenant more than you kept. After 40 years, I have watched more owners get burned on the deposit than on almost anything else, almost always because they did not know the rule.

What Louisiana Security Deposit Law Actually Requires

The governing statute is Louisiana Revised Statute 9:3251. The core rule is simple: after the lease ends and the tenant gives you a forwarding address, you have one month to either return the full deposit or send back the remaining balance along with an itemized statement explaining every deduction. Not a vague “damages” line — an actual itemized list with reasons. Miss that window or skip the itemization, and you have stepped outside the law.

What You Can Deduct

You are not required to hand back money a tenant genuinely owes. Under the statute, you may retain what is reasonably necessary to cover:

• Unpaid rent
• Other tenant defaults under the lease
• Repair of damage beyond normal wear and tear

That last phrase is where owners get into trouble. Normal wear and tear — faded paint, minor carpet wear, the ordinary aging of a lived-in unit — is not deductible. A hole punched in a wall, a destroyed floor, a unit left filthy beyond cleaning — that is damage, and it is fair game. The line between the two is exactly why documentation matters so much.

The deposit protects you only if you follow the rule. Keep money the wrong way and you can owe the tenant the deposit plus a penalty on top.

The Penalty for Getting It Wrong

Here is what makes Louisiana security deposit law bite. If a landlord willfully fails to comply — and failing to respond within 30 days of a tenant’s written demand is treated as willful — the tenant can recover the wrongfully retained amount plus the greater of 300 dollars or twice that amount, and potentially court costs and attorney’s fees. In other words, keeping 500 dollars you were not entitled to can turn into owing far more than that. It is not worth it.

How to Protect Yourself

The whole system rewards documentation, which is the same lesson I preach about every part of this business. Photograph the unit at move-in and move-out. Keep the signed condition report. Get the tenant’s forwarding address in writing at the end of the lease. Send the itemized statement on time, by certified mail. The owners who lose deposit disputes are the ones who kept nothing and relied on memory; the ones who win kept a clean file. This ties directly into how we handle transparent financial reporting and the documentation habits I covered in why binding arbitration belongs in your lease.

You can read the statute yourself on the Louisiana State Legislature site. This article is general information, not legal advice — for a specific dispute, talk to a Louisiana attorney. And if you want the deposit handled correctly every time, call David directly at 504-232-1672.

David Coxe is a licensed Louisiana real estate broker and the owner of Coxe Property Management and Leasing. He has managed residential property in New Orleans and Metairie for over 40 years. This article is general information, not legal advice. Call him directly at 504-232-1672.