Security deposit interest in Pennsylvania
Verified against 68 Pa. Stat. §§ 250.511a-250.511b and agency sources on 2026-07-04. Not legal advice.
Pennsylvania requires deposit interest only in specific situations.
- Applies when: deposit held more than 2 years - interest obligation begins on the second anniversary (i.e., from the third year of tenancy); deposits over $100 must be escrowed
- Rate: Actual interest earned on the required interest-bearing escrow account, minus a 1% per annum administrative fee the landlord may retain
- Paid: annually on the lease anniversary (from the third year onward)
- Statute: 68 Pa. Stat. §§ 250.511a-250.511b · primary source
Rate is whatever the escrow account earns minus 1%; no published state rate. Deposit cap drops from 2 months' rent (year 1) to 1 month's rent (year 2 onward).
Security deposit interest calculator
Frequently asked questions
Do landlords have to pay interest on security deposits in Pennsylvania?
Only in certain cases: deposit held more than 2 years - interest obligation begins on the second anniversary (i.e., from the third year of tenancy); deposits over $100 must be escrowed. Actual interest earned on the required interest-bearing escrow account, minus a 1% per annum administrative fee the landlord may retain (68 Pa. Stat. §§ 250.511a-250.511b).
When must deposit interest be paid in Pennsylvania?
Annually on the lease anniversary (from the third year onward).
Anything else Pennsylvania landlords should know about deposit interest?
Rate is whatever the escrow account earns minus 1%; no published state rate. Deposit cap drops from 2 months' rent (year 1) to 1 month's rent (year 2 onward).
Deposit interest in other states
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Related: rent increase rules in Pennsylvania · prorated rent calculator