Being a landlord in Riverside, California comes with a lot of different mandates that you have to follow, unless you want to get sued. Security deposits are one of the most important things a landlord needs to stay informed about. Just recently, I visited a property where the landlord had not yet given back the security deposit to the previous tenant, even though it was past the 21 day due date. This is incredibly illegal, and opens that landlord up to a very expensive lawsuit. So, let's make sure the same thing does not happen to you, and go over what you need to know about security deposits in Riverside, California.
What Is California Civil Code Section 1950.5?
California Civil Code Section 1950.5 is the main “security deposit law” reference that you need to understand in order to be a successful landlord. It is incredibly important to read through the entirety of the law, however, we will focus mainly on how long you have until you need to actually return the tenant's security deposit. CCCS 1950.5 states:
“No later than 21 calendar days after the tenant has vacated the premises, but not earlier than the time that either the landlord or the tenant provides a notice to terminate the tenancy under Section 1946 or 1946.1, Section 1161 of the Code of Civil Procedure, or not earlier than 60 calendar days prior to the expiration of a fixed-term lease, the landlord shall furnish the tenant, by personal delivery or by first-class mail, postage prepaid, a copy of an itemized statement indicating the basis for, and the amount of, any security received and the disposition of the security, and shall return any remaining portion of the security to the tenant. After either the landlord or the tenant provides notice to terminate the tenancy, the landlord and tenant may mutually agree to have the landlord deposit any remaining portion of the security deposit electronically to a bank account or other financial institution designated by the tenant. After either the landlord or the tenant provides notice to terminate the tenancy, the landlord and the tenant may also agree to have the landlord provide a copy of the itemized statement along with the copies required by paragraph (2) to an email account provided by the tenant.
(2) The landlord shall also include, along with and at the same time the itemized statement is sent, copies of documents showing charges incurred and deducted by the landlord to repair or clean the premises, as follows:
(A) If the landlord or landlord’s employee did the work, the itemized statement shall reasonably describe the work performed. The itemized statement shall include the time spent and the reasonable hourly rate charged.
(B) If the landlord or landlord’s employee did not do the work, the landlord shall provide the tenant a copy of the bill, invoice, or receipt supplied by the person or entity performing the work. The itemized statement shall provide the tenant with the name, address, and telephone number of the person or entity, if the bill, invoice, or receipt does not include that information.
(C) If a deduction is made for materials or supplies, the landlord shall provide a copy of the bill, invoice, or receipt. If a particular material or supply item is purchased by the landlord on an ongoing basis, the landlord may document the cost of the item by providing a copy of a bill, invoice, receipt, vendor price list, or other vendor document that reasonably documents the cost of the item used in the repair or cleaning of the unit.
(D) If a deduction is made for repairs or cleanings allowed by this section, the landlord shall provide photographs taken pursuant to subdivision (g), along with a written explanation of the cost of the allowable repairs or cleanings, as described in subparagraphs (A) to (C), inclusive. The landlord may provide such photographs to the tenant by mail, email, computer flash drive, or by providing a link where the tenant may view the photographs online.
(3) If a repair to be done by the landlord or the landlord’s employee cannot reasonably be completed within 21 calendar days after the tenant has vacated the premises, or if the documents from a person or entity providing services, materials, or supplies are not in the landlord’s possession within 21 calendar days after the tenant has vacated the premises, the landlord may deduct the amount of a good faith estimate of the charges that will be incurred and provide that estimate with the itemized statement. If the reason for the estimate is because the documents from a person or entity providing services, materials, or supplies are not in the landlord’s possession, the itemized statement shall include the name, address, and telephone number of the person or entity. Within 14 calendar days of completing the repair or receiving the documentation, the landlord shall complete the requirements in paragraphs (1) and (2) in the manner specified.”
So, let’s actually break it down and understand what the law is saying about returning security deposits:
Security Deposit Return Requirements:
Timeline:
The landlord must return the remaining deposit within 21 calendar days after the tenant vacates.
Cannot send earlier than notice to terminate tenancy or 60 days before fixed-term lease ends.
Delivery Method:
Must send itemized statements by personal delivery or first-class mail.
Parties may agree to receive refund via electronic deposit and itemized statement via email.
Itemized Statement Must Include:
For landlord-performed work:
Description of work.
Time spent and reasonable hourly rate.
For third-party work:
Copy of bill/invoice/receipt from the service provider.
Must include name, address, and phone number (if not already on receipt).
For materials or supplies:
Copy of bill/invoice/receipt.
If bought regularly, may use a vendor price list or similar proof.
For repair/cleaning deductions:
Photographs of damage/cleaning issues.
Written cost explanation using info from (A)-(C).
Photos can be sent via mail, email, flash drive, or link.
If Work Can’t Be Completed in 21 Days:
Use a good faith estimate for uncompleted work or missing documents.
Include name, address, and phone number of the service provider if documents are missing.
Within 14 calendar days of completing work or receiving documents, the landlord must send the final itemized statement and receipts.
For landlords in Riverside, California, complying with Civil Code Section 1950.5 means you must carefully document and return any unused portions of a tenant’s security deposit within 21 calendar days after they vacate, no sooner than the official notice to terminate or 60 days before a fixed-term lease ends. You’ll need to mail or hand-deliver an itemized statement that outlines all charges, whether for your own labor (with hours worked and a reasonable rate) or third-party services (with bills or invoices and provider contact information), as well as copies of receipts for materials and photographs of any damage or cleaning issues. Riverside property managers and landlords can streamline this process—and improve tenant relations—by offering electronic deposit of remaining funds and emailing statements when mutually agreed. If repairs or invoices aren’t finalized within 21 days, you may include a good-faith cost estimate and then follow up with final documentation and receipts within 14 days of completion. By adhering to these detailed, professional practices, Riverside landlords not only fulfill California security deposit laws but also enhance transparency and trust in their property management operations.
What Is Assembly Bill 12 (AB 12)?
Assembly Bill 12 is a recent addition to the California Civil Code Section 1950.5 put in effect July 1st, 2024. The court mandated that there should be a decrease in the limit that landlords charge for security deposits. The legislature states that it prohibits a landlord from:
“demanding or receiving security for a rental agreement for residential property in an amount or value in excess of an amount equal to one month’s rent, regardless of whether the residential property is unfurnished or furnished, in addition to any rent for the first month paid on or before initial occupancy. The bill, unless the prospective tenant is a service member, as defined, would prohibit a landlord from demanding or receiving security for a rental agreement for residential property in an amount or value in excess of 2 months’ rent, in addition to any rent for the first month, if the landlord (1) is a natural person or a limited liability corporation in which all members are natural persons and (2) owns no more than 2 residential rental properties that collectively include no more than 4 dwelling units offered for rent.”
Assembly Bill 12 Simplified (Security Deposit Caps):
Maximum Deposit:
Landlords cannot demand or receive more than two months’ rent as security, plus first month’s rent.
Applies whether the unit is furnished or unfurnished.
Exemption for Service Members:
Service members (as defined by law) are not covered by this cap.
Owner Eligibility:
Cap applies only if the landlord is a natural person or an LLC where all members are natural persons.
Landlords may own no more than two residential rental properties total.
Those properties may include up to four dwelling units combined.
What Assembly Bill 12 Means for Riverside Landlords
For Riverside, California landlords who personally own one or two small residential properties, Assembly Bill 12 now strictly limits security deposits to no more than two months’ rent in addition to the first month’s payment—regardless of whether your unit is furnished or unfurnished. This cap does not apply if your prospective tenant is a qualified service member, but it does require you to carefully track your ownership status (must be a natural person or single‐member LLC, with no more than four total rental units). By adhering to these new security deposit ceilings, Riverside landlords safeguard compliance with state law, maintain competitive and transparent leasing practices, and foster positive tenant relationships in the Inland Empire market.
How to Stay Compliant as a Riverside Landlord
Conduct Thorough Research on Riverside’s Rental Laws
Research is one of the most important things you have to be doing as a landlord in order to succeed in Riverside’s rental market. Not knowing the laws of California can open you up to lawsuits, which can set you back thousands of dollars. Something no one wants to go through in their lifetime, I promise. I recommend blocking off a certain amount of time throughout the week and just reading through our different blogs and legislatures relating to property management. If you would like a list of things to read for now, I will give them to you here:
I would start with these laws for now, and then do your own research after reading these legislatures, if you would like to make it easier for yourself, you can use ChatGPT and ask the following question: “what California laws do landlords NEED to know, list them all in bullet point format”. This way, you can continue to conduct research and fully understand the law in which you are (hopefully) complying with.
Consider Partnering With a Riverside Property Management Company
The myth that property management companies are not worth the cost is completely untrue. I promise you that you will never have the same amount of stress as you do right now if you find the right property management company. If you want a guide on how to do just that, click here. As for what the property management company actually does, this is a list of all the services that OUR property management company provides:
- Property Marketing
- Tenant Screening
- Rent Collection
- Property Maintenance
- Accounting and Financial Reporting
- Evictions
- Property Inspections
- Legal Compliance
- Home Watch
When you hire the right company for your needs, not only do you reduce the stress in your life, you also maximize the income of your rental property. Experienced managers keep you fully compliant with state and local regulations, while handling tenant screening to secure reliable renters quickly and reduce vacancy periods. They also collect rent and provide accounting through automated systems, enforce late fees lawfully, and provide transparent financial reporting. With established vendor networks and routine inspections, a property manager can proactively address maintenance issues, control repair costs, and preserve your property’s value. Tenants benefit from 24/7 support and emergency response, boosting satisfaction and retention, while targeted marketing and competitive rate-setting fill vacancies faster. Whether you own a single Riverside home or a growing portfolio across the Inland Empire, partnering with a qualified property management firm lets you scale efficiently, protect your assets, and focus on long-term growth rather than day-to-day operations.
Talk to a Qualified Real Estate Attorney in Riverside
Even the most diligent Riverside landlord can encounter complex scenarios that stretch beyond a straightforward security deposit return or a two-month deposit cap under AB 12. When you’re facing questions about whether a damage deduction truly qualifies under California Civil Code Section 1950.5, or if your property ownership structure triggers AB 12’s limits, a local real estate attorney can be your best ally. For example, missing the 21-day deadline to return a security deposit not only risks a lawsuit—like the case of the landlord who never refunded a tenant on time—but can expose you to statutory damages up to twice the amount of the deposit plus legal fees.
A qualified attorney will:
Interpret the nuances of Section 1950.5’s itemized deduction rules, good-faith estimates, and 14-day follow-up requirements, ensuring your lease and move-out processes leave no room for costly missteps.
Advise on AB 12 eligibility, confirming whether your natural-person ownership or LLC structure and unit count qualify for the two-month deposit cap—or if you need to adjust your approach or entity formation as your portfolio grows.
Draft and review custom lease clauses—from pet deposits to late-fee schedules—in compliance with California’s anti-penalty and habitability laws, so you avoid unenforceable terms and potential disputes.
Navigate local Riverside ordinances, such as occupancy limits or city-mandated inspection requirements, aligning municipal codes with state law.
By engaging a real estate attorney familiar with the Inland Empire’s courts and landlord-tenant landscape, you’ll not only mitigate legal risk but also gain confidence that your practices are rock-solid. Instead of scrambling to research every code change or fielding threats of small-claims litigation, you can rely on expert guidance to keep your Riverside properties profitable, compliant, and protected.
Implement a Compliance Checklist
Implementing a compliance checklist is your blueprint for consistent, error-free property management in Riverside. By codifying every critical step—from verifying AB 12 deposit limits and Section 1950.5 timelines to scheduling quarterly lease reviews and move-out photo inspections—you create a repeatable system that prevents missed deadlines and legal oversights. A formal checklist not only helps you track tasks like sending itemized statements within 21 days or following up with final receipts in 14 days, but it also documents your due diligence should a dispute ever arise. For Riverside landlords, where strict local ordinances and California statutes intersect, a compliance checklist acts as both a daily operational guide and a record of your adherence to the law—minimizing risk, saving you money in potential fines or litigation, and reinforcing your reputation for professionalism in the competitive Inland Empire rental market. Here is a completely free checklist you can use to stay compliant with Riverside’s vast amount of laws and regulations:
Task | Frequency | Notes |
Review §1950.5 and AB 12 language in lease forms | Annual | Update any new statutory text or effective dates. |
Audit move-out procedures and photo-documentation workflows | Quarterly | Verify you have templates for itemized statements and photos. |
Verify deposit refund deadlines (21-day / 14-day follow-up) | Each tenant move-out | Automate reminders in your property management software. |
Confirm ownership status for AB 12 eligibility | When adding or selling units | Track total properties and units owned under your name/LLC. |
Schedule legal review of any unusual lease clauses or tenant disputes | As needed | Engage counsel early to avoid costly litigation. |
Train staff on electronic deposit and email-statement processes | Bi-annual | Ensure clear tenant instructions are provided at move-in. |
Communicate Clearly With Tenants
Clear, proactive communication with your tenants sets the stage for a smooth, dispute-free tenancy in Riverside’s competitive rental market. By explaining move-in and move-out procedures—such as how and when you’ll inspect the unit, what constitutes “normal wear and tear,” and the exact timeline for returning security deposits under Section 1950.5 and AB 12—you eliminate confusion and build trust from day one. Timely reminders about lease-termination notices, walkthrough appointments, and potential deductions (complete with photo examples) help tenants address minor issues before they become costly repairs. Offering multiple channels—email, text, or phone—and providing clear, written checklists ensures every renter understands their responsibilities and your expectations. In the event of a conflict over deposit deductions or late fees, you’ll have documented proof that you communicated policies transparently, significantly reducing the risk of small‐claims lawsuits. Ultimately, open dialogue fosters better tenant relationships, higher renewal rates, and a reputation for professionalism that distinguishes Riverside landlords in the Inland Empire.
Final Thoughts for Riverside Property Owners
As a Riverside property owner, staying informed and proactive about California’s landlord-tenant laws is your best defense against disputes and liabilities. By following Civil Code Section 1950.5, leveraging the expertise of property management professionals and real estate attorneys, you’ll not only ensure legal compliance but also foster transparency and trust with your tenants. In today’s competitive Riverside market, doing this can be the difference between a short-term renter and a long-term, responsible tenant, which ultimately will protect your investment and peace of mind.
Do you need further assistance on your Riverside rental property? Schedule a free 30-minute consultation with PMI Riverside today. We’ll answer your questions, review your current procedures, and help you implement a compliance strategy tailored to Riverside’s unique rental landscape. Secure your rental property’s success and book a call with us!
