South Dakota Security Deposit Laws: 2024 Updates
Complete guide to South Dakota security deposit regulations including the 21-day residential return deadline and 60-day commercial rule.
Legal Disclaimer
This content is for general informational and educational purposes only. It does not constitute legal advice and should not be relied upon as such. Laws change frequently — always verify current regulations and consult a licensed attorney in your jurisdiction for advice specific to your situation. Landager is a property management platform, not a law firm.Information last verified: May 2026.
The foundational legal basis for property rights in the state is established by the South Dakota Constitution. Under SDCL § 43-32-24, South Dakota law requires landlords to return residential security deposits or provide a written statement of deductions within 14 days after tenancy termination and receipt of the tenant's forwarding address. Commercial properties follow a separate track under SDCL § 43-32-6.2.
Residential Security Deposits
1. The One-Month Cap (SDCL § 43-32-6.1)
The standard security deposit for a residential unit cannot exceed one month's rent.
- Exception: A larger deposit may be agreed upon between the lessor and the lessee where special conditions pose a danger to the maintenance of the premises. This can include a pet deposit, which may allow for a total deposit of up to two months' rent.
2. The 14-Day Return Rule (SDCL § 43-32-24)
Landlords must adhere to the following timelines for returning residential security deposits:
- Initial Deadline: The landlord must return the security deposit (or the balance) within 14 days after the termination of the tenancy and receipt of the tenant's mailing address or delivery instructions.
- Written Statement: If any portion is withheld, a written statement showing the specific reason for the withholding must be furnished to the tenant within this same 14-day window.
- Itemized Accounting: Within 45 days after the termination of the tenancy, upon request of the lessee, the landlord must provide an itemized accounting of any deposit withheld.
Commercial Security Deposits (SDCL § 43-32-6.2)
Commercial property owners operate under different statutory timelines:
- No Statutory Cap: There is no legal limit on the amount of a commercial security deposit.
- 60-Day Return: The landlord has 60 days after the tenant vacates to return the deposit.
- 90-Day Itemization: If requested by the tenant, the landlord must provide an itemized list of deductions within 90 days.
Allowable Deductions
Landlords may deduct from the security deposit for:
- Unpaid Rent: Any balance due at the end of the term.
- Damages: Costs to repair damage beyond "normal wear and tear."
- Cleaning: Costs to restore the unit to its move-in cleanliness level.
Penalties for Late Return (SDCL § 43-32-24)
If a residential landlord fails to comply with the statutory deadlines for returning the deposit or providing the required statements:
- Forfeiture: They automatically forfeit all rights to withhold any portion of the deposit.
- Civil Liability: The tenant may sue for the full return of the deposit.
- Punitive Damages: Bad faith retention of a deposit or failure to provide the required written statement or itemized accounting may subject the landlord to punitive damages not to exceed two hundred dollars.
Non-Refundable Fees
Any money given to the landlord "at the beginning of the tenancy" to secure the performance of a residential rental agreement is deemed a security deposit and is subject to the security deposit return rules. Therefore, non-refundable cleaning fees are generally not permitted.
Interest on Security Deposits
South Dakota law does not require landlords to pay interest on security deposits.
Best Practices for Landlords
- Request Forwarding Addresses: Do this during the move-out inspection. The 14-day clock starts when the tenancy ends and you receive the address.
- Document Everything: Use the Landager move-in/move-out checklist with photos to justify any deductions.
- Handle Interest Properly: South Dakota law does not require you to pay interest on deposits, but many landlords use a separate escrow account as a best practice for organization.
Frequently Asked Questions
▶What are the South Dakota security deposit rules and return deadlines?
South Dakota has specific rules governing how much landlords can charge for security deposits, how deposits must be held, and the deadline for returning deposits after a tenant moves out. Landlords must provide an itemized statement of any deductions made from the deposit. Failure to comply with deposit return deadlines can result in penalties and the forfeiture of the landlord's right to claim deductions.
▶What are the South Dakota landlord-tenant laws every property owner should know?
South Dakota offers a relatively landlord-friendly regulatory environment compared to many other states. The state's landlord-tenant laws are primarily codified in SDCL Chapter 43-32, and recent legislative changes effective July 1, 2024, have further streamlined eviction procedures for property owners. This guide covers the essential compliance requirements for property owners and landlords.
Read the complete guide▶What is the South Dakota eviction process and how long does it take?
The South Dakota eviction process requires landlords to provide written notice to tenants before filing a court action. The type and length of notice depends on the reason for eviction — typically shorter for non-payment of rent and longer for lease violations or no-fault terminations. Self-help evictions (changing locks, removing belongings, shutting off utilities) are illegal in South Dakota. The full court process varies but typically takes several weeks.
Read the complete guide▶What are the South Dakota rent increase laws and caps for landlords?
South Dakota has specific rules governing when and how landlords can increase rent. During a fixed-term lease, rent generally cannot be increased unless the lease explicitly allows it. For month-to-month tenancies, landlords must provide proper written notice before an increase takes effect. Check whether South Dakota has any local rent control ordinances that may impose additional caps or requirements.
Read the complete guide▶What is the grace period for late rent in South Dakota?
South Dakota has specific rules regarding grace periods for late rent and the amount that can be charged as a late fee. Late fee provisions must be stated in the lease agreement, and fees must be reasonable. Check South Dakota state law and any applicable local ordinances for the exact grace period and late fee limits that apply to your rental property.
Read the complete guide▶What disclosures must South Dakota landlords provide to tenants?
South Dakota landlords must provide certain disclosures to tenants before or at the time of lease signing. Common required disclosures include lead-based paint hazards (for pre-1978 buildings, a federal requirement), the identity of the landlord or property manager, and any known material defects in the property. Additional state-specific disclosures may include flood risk, mold hazards, and environmental conditions.
Read the complete guide▶What are the South Dakota lease requirements for rental properties?
South Dakota recognizes both written and oral leases, though written leases are strongly recommended for terms longer than one year. Lease agreements should include the rent amount, payment due date, security deposit terms, maintenance responsibilities, and rules regarding entry, pets, and subletting. Certain lease clauses that waive tenant statutory rights may be void and unenforceable under South Dakota law.
Read the complete guide▶What are South Dakota landlord maintenance obligations and habitability standards?
South Dakota landlords must maintain rental properties in a condition that is fit for habitation and complies with applicable building, housing, and health codes. This includes maintaining structural integrity, plumbing, heating and cooling systems, electrical systems, and pest control. Tenants typically have the right to request repairs in writing, and if repairs are not made within a reasonable time, tenants may have legal remedies available.
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