Security Deposit Return Deadlines & Deductions in Arkansas
At a glance
| Governing law | Ark. Code Ann. §§ 18-16-301 to -306 (Residential Security Deposit Act) |
|---|---|
| Deadline to return the deposit | 60 days after BOTH termination of the tenancy AND delivery of possession by the tenant |
| Itemized statement required? | Yes, if any amount is withheld — a written itemized notice of deductions delivered with the remaining balance inside the same 60 days |
| What can be deducted | Accrued unpaid rent; damages the landlord suffered from the tenant's noncompliance with the rental agreement. The statute's own text never uses the phrase 'wear and tear' — that description comes only from secondary sources paraphrasing this clause. |
| Maximum deposit amount | 2 months' periodic rent — but the entire subchapter (cap, deadline, and penalty) doesn't apply at all to a landlord who owns 5 or fewer dwelling units, unless a third party manages the unit or collects rent for a fee |
| Interest on the deposit? | No interest required |
| Penalty for a late/bad-faith withholding | Recovery of the property/money due, damages equal to 2x the amount wrongfully withheld, costs, and reasonable attorney fees. If the landlord proves the noncompliance was an error despite reasonably designed procedures, or a good-faith dispute over the amount due, liability is limited to costs and the amount itself — no doubling, no fees. |
| Separate account or bond required? | None — no segregated account, interest-bearing account, or bond required |
Requirements one by one
Governing law
Arkansas's rules live in a free-standing statute, the Residential Security Deposit Act, Ark. Code Ann. §§ 18-16-301 to -306 — Arkansas hasn't adopted the broader Uniform Residential Landlord and Tenant Act that some other states use.
Deadline to return the deposit
The 60-day period only starts once two things have happened: the tenancy has terminated, and the tenant has delivered possession back to the landlord. The statute frames it as a baseline return duty plus a deduction-specific exception: "Within sixty (60) days of termination of the tenancy, property or money held by the landlord as security shall be returned to the tenant," but where deductions apply, the itemized notice and "the remainder of the amount due" aren't required until "sixty (60) days after termination of the tenancy and delivery of possession by the tenant." (§ 18-16-305(a)).
Itemized statement required?
Yes, whenever the landlord withholds any part of the deposit — the deductions have to be "itemized by the landlord in a written notice delivered to the tenant" inside that same 60-day window (§ 18-16-305(a)(2)).
What can be deducted
The statute allows applying the deposit to "accrued unpaid rent and any damages which the landlord has suffered by reason of the tenant's noncompliance with the rental agreement" (§ 18-16-305(a)(2)). Notably, the statute's own text never uses the phrase "wear and tear" at all — that framing comes from secondary sources paraphrasing this clause, not the law itself, so don't expect to find that exact phrase if you read the statute directly.
Maximum deposit amount
The cap is two months' periodic rent (§ 18-16-304) — but only for landlords this Act actually covers. See "What trips people up" below: a large chunk of Arkansas rentals fall outside the cap entirely.
Interest on the deposit?
No. Nothing in this subchapter requires interest on a held deposit.
Penalty for a late/bad-faith withholding
A tenant whose landlord fails to comply can recover "the property and money due," "damages in an amount equal to two (2) times the amount wrongfully withheld," "costs," and "reasonable attorney's fees" (§ 18-16-306(a)(1)). That penalty has a real limit, though: if the landlord proves, by a preponderance of the evidence, that the noncompliance either "resulted from an error which occurred despite the existence of procedures reasonably designed to avoid such errors" or "was based on a good faith dispute as to the amount due," the landlord owes only "costs and the sum erroneously withheld" — no doubling, no attorney fees (§ 18-16-306(a)(2)).
Separate account or bond required?
No. This subchapter doesn't require a landlord to hold a deposit in a segregated or interest-bearing account, or post a bond.
What trips people up
A large share of Arkansas landlords are entirely outside this law. The whole subchapter — the cap, the 60-day deadline, the itemization duty, the double-damages penalty — does not apply to the described individual owners whose family and related rental entities collectively own five or fewer dwelling units (§ 18-16-303(a)). Before assuming any of these protections apply, find out how many units your landlord owns.
The small-landlord exemption doesn't survive hiring a property manager. Even a landlord who owns five or fewer units loses the exemption "for which management, including rent collection, is performed by third persons for a fee" (§ 18-16-303(b)) — so a small landlord using a property-management company is still bound by the full statute.
Never providing a forwarding address can cost you the deposit after 180 days. If the landlord's mailed refund comes back undeliverable and the landlord can't locate you after a reasonable effort, the money becomes the landlord's after 180 days from the mailing date (§ 18-16-305(b)(2)) — send a forwarding address promptly to avoid this.
Common questions
My landlord never sent me anything 60 days after I moved out — what am I owed? Assuming your landlord is covered by this Act (more than 5 units, or uses a paid property manager), you can recover the deposit itself, double the amount wrongfully withheld, court costs, and attorney fees — unless the landlord shows the failure was a genuine good-faith error or dispute.
Does the 2-month cap apply to every landlord? No. It only binds landlords who own more than five dwelling units, or any landlord (regardless of unit count) who uses a paid third-party manager or rent collector.
Do I get interest on my deposit while my landlord holds it? No. Arkansas doesn't require interest on a held security deposit.
Statutes and sources
- Ark. Code Ann. § 18-16-303 — exemption for landlords owning 5 or fewer units. https://law.justia.com/codes/arkansas/title-18/subtitle-2/chapter-16/subchapter-3/section-18-16-303/ (accessed 2026-07-06)
- Ark. Code Ann. § 18-16-304 — 2-month deposit cap. https://law.justia.com/codes/arkansas/title-18/subtitle-2/chapter-16/subchapter-3/section-18-16-304/ (accessed 2026-07-06)
- Ark. Code Ann. § 18-16-305(a) — dual-trigger 60-day return/itemization deadline and permitted deductions. https://law.justia.com/codes/arkansas/title-18/subtitle-2/chapter-16/subchapter-3/section-18-16-305/ (accessed 2026-07-06)
- Ark. Code Ann. § 18-16-305(b) — mailing compliance and the 180-day forfeiture rule. https://law.justia.com/codes/arkansas/title-18/subtitle-2/chapter-16/subchapter-3/section-18-16-305/ (accessed 2026-07-06)
- Ark. Code Ann. § 18-16-306(a) — double damages, costs, attorney fees, and the good-faith-error/dispute defense. https://law.justia.com/codes/arkansas/title-18/subtitle-2/chapter-16/subchapter-3/section-18-16-306/ (accessed 2026-07-06)
Source links
Every statute quoted above, linked, with the date we checked it.
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