Expenses which you can deduct from security deposit : ezLandlordForms

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Munish K

started a topic almost 9 years ago

Hi My tenant is moving out of state and hence we mutually agreed to break the lease. But I had incurred some expenses to show the property to multiple families during different times, eating out, mileage as well to go to property. So Can I charge these expenses as deduction while returning the security deposit? Thanks M.

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Susan P

said almost 9 years ago

These cannot be taken out fro the security deposit as that is only used for damages to the premises beyond normal wear and tear. You can however save those receipts and deduct them during tax time as this is a business that you run and these do fall under deductible expenses. Any damages to the property make sure to document, photo and save receipts of the costs to repair.

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Dana H

said almost 9 years ago

Hi Munish, Completely agree with Susan. Do not deduct them from the security deposit, as it could get you into legal trouble. However, your tenant is responsible for paying the rent (under California law - Cal. Civ. Code § 1951.2) until you find a replacement tenant. However, you must use reasonable effort to re-rent the property. I have put this information below in a link from Nolo. Also, try to minimize the expenses associate with advertising the property. Showing the property on a one-on-one basis has never been a good approach to me. You should host open houses as it (1) allows you to show multiple prospective tenants at once and (2) shows additional demand, which makes tenants want to sign/decide sooner. I recommend Hemlane (www.hemlane.com) to help make your process faster with finding and verifying a tenant. Hope that helps! Dana http://www.nolo.com/legal-encyclopedia/tenants-right-break-rental-lease-california.html Under California law (Cal. Civ. Code § 1951.2), your landlord must make reasonable efforts to re-rent your unit—no matter what your reason for leaving—rather than charge you for the total remaining rent due under the lease. So you may not have to pay much, if any additional rent, if you break your lease. You need pay only the amount of rent the landlord loses because you moved out early. This is because California requires landlords to take reasonable steps to keep their losses to a minimum—or to “mitigate damages” in legal terms.