Vermont law treats a security deposit as your money that the landlord only holds. That single idea drives everything on this page: how much can be asked of you up front, what happens to the cash while you rent, and a hard legal deadline for giving it back once you hand over the keys.
| Max deposit | 1 month's rent Up to 2 months with written consent for prepayments or pet/alteration terms. |
|---|---|
| Return deadline | 14 days after you give up possession |
| Interest on deposit | Required Yes — 2%. The requirement applies after the first full year. Vermont law requires interest on deposits held beyond a year. Rate changes — verify with the state source Run your own tenancy through the calculator to turn the rule into dollars. |
| Statute | 9 V.S.A. § 4461 |
In Vermont, the ceiling is 1 month's rent. Up to 2 months with written consent for prepayments or pet/alteration terms. Whatever the cap, the deposit remains your money: the cap limits the request, and the sections below limit what can happen to it afterward.
Vermont landlords have 14 days from when you give up possession — normally the day you return all keys — to either refund the deposit or send the written itemization that state law requires. Mark the date on your calendar the day you move; a deadline that passes without refund or statement is what converts an awkward wait into a legal claim.
Yes — 2%. The requirement applies after the first full year. Vermont law requires interest on deposits held beyond a year. Rate changes — verify with the state source Run your own tenancy through the calculator to turn the rule into dollars.
Like nearly every state, Vermont lets landlords charge for real damage and unpaid costs — but not for normal wear and tear. Faded paint, worn carpet in a walkway, and small nail holes from picture hangers are the landlord's cost of doing business; broken fixtures, uncleaned appliances, and unpaid rent are chargeable. When deductions are taken, Vermont requires them in writing — so photograph the unit at move-out and keep the timestamped set until the money arrives. Every line item can then be checked against how the unit actually looked, which is how inflated deductions get beaten.
Wrongful withholding can bring the deposit back plus damages and penalties. The route is almost always the same: a written demand letter citing the deadline and 9 V.S.A. § 4461, then small claims court in the county where the unit sits. Filings are cheap, lawyers aren't required, and landlords who ignored two letters usually settle the week a court date appears.
Three moves protect a Vermont deposit: (1) compare the deposit you're being asked for against the cap above before you sign; (2) photograph the unit at move-in and again at move-out — documentation settles most disputes before they start (our interactive checklist walks you through it); (3) the day you return keys, write the deadline on your calendar and send your forwarding address in writing. If that date passes in silence, the demand letter template takes about ten minutes, and small claims court is the next stop.
Cap check, your personal deadline date, and the interest your deposit earned — in about twenty seconds.
This page summarizes 9 V.S.A. § 4461 as last reviewed October 5, 2026. Laws and locally announced rates change — confirm current figures with the Vermont housing authority or attorney general's consumer site before relying on them.