Security Deposits in Chicago and Illinois

Which law applies

• Chicago RLTO — if the property is in the City of Chicago
• Cook County RTLO — unincorporated Cook County and most suburbs (some opted out)
• Evanston, Mount Prospect, Oak Park, Urbana — have their own local ordinances
• Illinois Security Deposit Return Act (765 ILCS 710) — for properties outside those jurisdictions, 5+ units
• Illinois Security Deposit Interest Act (765 ILCS 715) — for 25+ unit properties, requires interest
• No applicable local ordinance + small building (under 5 units) — common-law contract principles apply

The building's location determines the law. Chicago RLTO applies to most Chicago rental housing, with limited exceptions (owner-occupied 6-unit-or-fewer buildings, hotels, dorms, and a few others).

Chicago RLTO requirements

At move-in

• Landlord must provide a written RLTO summary
• If a deposit is taken, landlord must provide a receipt with the name of the person accepting it, the date, and a description of the dwelling

During the tenancy

• Deposit held in federally-insured bank in Illinois — cannot be commingled with landlord's personal funds
• Interest paid annually on deposits held more than 6 months (rate set annually by the Chicago Comptroller)
• Bank and account disclosure — landlord must disclose where the deposit is held on request

At move-out

• Within 30 days of move-out, landlord must deliver either (a) the full deposit plus interest, or (b) an itemized statement of deductions with receipts/estimates attached
• If deductions are for damage, an additional 30 days is allowed to deliver the refund after the statement — but the statement itself must arrive within 30 days of move-out
• Deductions cannot be made for "ordinary wear and tear"

Penalties for violation

• Two times the deposit — statutory damages for most RLTO violations
• Attorney's fees — tenant's attorney fees paid by landlord on successful claims

These are strict-liability penalties — even good-faith errors can trigger double damages if procedures were not followed.

Ordinary wear and tear vs damage

Ordinary wear and tear — the landlord pays. Examples: minor carpet wear, faded paint, nail holes from normal hanging, small stains on counter, drawer that has loosened from use.

Damage — the tenant may be charged. Examples: large holes in walls, pet urine stains, broken windows, burn marks, graffiti, substantial cleaning needed beyond normal.

Illinois courts and Chicago administrative rulings interpret ordinary wear and tear broadly in favor of tenants. A 5-year-old carpet with worn traffic patterns is wear. The carpet that needs replacement after 1 year because of pet damage is damage.

What to do before moving out

1. Give proper notice. Month-to-month tenancy typically requires 30-day written notice before the end of a rental period. Fixed-term leases end on their own.
2. Take photos and video before returning keys. Date-stamp them. Include every room, all appliances, walls, floors.
3. Clean thoroughly. Professional-level cleaning prevents "cleaning fee" deductions.
4. Document any pre-existing conditions — if the kitchen counter was chipped when you moved in, the photos you took at move-in matter now.
5. Provide forwarding address in writing — required in some ordinances for deposit return to be due.
6. Keep copies of lease and all correspondence.

If the deposit is not returned

Step 1 — Send a demand letter

A written demand to the landlord at their last known address, citing the applicable ordinance and the specific amount owed. Send certified mail with return receipt. Give a reasonable deadline (often 14 days).

Step 2 — File in small claims court

If the landlord ignores the demand or disputes the amount, file a small claims suit. Chicago RLTO statutory damages (2× deposit) plus attorney's fees, even on small deposits, can make this worthwhile. Some attorneys take RLTO deposit cases on contingency because of the attorney-fee provision.

Step 3 — Alternative: consumer fraud

For particularly egregious cases, the Illinois Consumer Fraud and Deceptive Business Practices Act may provide additional remedies.

Illinois statewide rules (outside Chicago/Cook County)

For properties in jurisdictions without local ordinances:

• Illinois Security Deposit Return Act (765 ILCS 710) — applies to buildings with 5+ units. Landlord must return deposit within 30 days OR within 30 days send an itemized list of damages with receipts.
• Illinois Security Deposit Interest Act (765 ILCS 715) — applies to buildings with 25+ units. Requires interest payment at the passbook savings rate.
• Smaller buildings — contract law applies. The landlord still has to account for the deposit, but the statutory penalties don't apply.

Move-in inspection

A documented move-in inspection is your best protection. Walk through with the landlord (ideally), note every existing condition on a form both of you sign, and take date-stamped photos. Any "damage" the landlord tries to deduct at move-out that was documented at move-in is not deductible.

Free help

• Metropolitan Tenants Organization hotline — 773-292-4988
• Illinois Legal Aid Online — Housing — illinoislegalaid.org
• Legal Aid Chicago — Housing — 312-341-1070
• Lawyers' Committee for Better Housing — lcbh.org
• Chicago Department of Housing — RLTO information