Indiana security deposit law
What can a landlord deduct from a security deposit in Indiana?
The short answer
In Indiana, generally only unpaid rent, damage beyond normal wear and tear, and other charges the lease and Ind. Code § 32-31-3-12 actually allow, each listed in an itemized statement. Ordinary wear, worn carpet, faded paint, small nail holes, cannot be charged to you.
Indiana law limits deductions to real, provable losses: unpaid rent, cleaning to return the unit to its move-in condition, and repairs for damage beyond normal wear and tear, under Ind. Code § 32-31-3-12. Every deduction must appear in an itemized statement.
What cannot be deducted: ordinary wear and tear. That includes carpet worn by normal walking, paint faded by sunlight, minor scuffs, and small nail holes from hanging pictures. Time and normal living cause these; tenants do not pay for them.
The common overreaches to challenge: full repainting after a multi-year tenancy, carpet replacement charged at new-carpet prices with no age adjustment, generic "cleaning fees" with no invoice, and charges for conditions documented at move-in.
If a deduction fails these tests, dispute it in writing: a demand letter citing Ind. Code § 32-31-3-12 that walks through each charge and why it is unlawful. Landlords drop weak deductions quickly when a tenant shows they know the standard, because defending them in court costs more than the charge.
The Indiana rules at a glance. Governing statute: Ind. Code § 32-31-3-12. Return deadline: 45 days. Statutory damages: damages equal to the deposit for wrongful withholding. Attorney's fees: recoverable in qualifying cases. Court for disputes: Small Claims Court, claims up to $8,000.
Looking for the rules beyond this state? My landlord never did a move-in inspection. Does that matter?
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