Escrow usually means "a third party" ...but a bank account that only I have access to isn't technically escrow ...so I'm not getting this. --73.52.xx.xxx

North Carolina has the same law but no one seems to follow it. That said, I opened a business checking account that says Peter Properties Escrow and the only thing I put in there is the security deposits. When the time comes to return the security deposit I will write a check to the tenant out of that account. Get new tenants to write you two checks, one for Peter Properties and one for Peter Properties Escrow. --65.188.xxx.xxx

I have one savings account for each building titled Smith St Security Deposit. Only security deposits come in and out of it. The bank used to do checks from the account to the tenant but now that there is a charge I transfer the amount to checking and write a check for the same amount to the tenant on the same day and pop it in the mail. I figure if it is ever questioned the paper trail will show it sat in an account that was not an operating account and then was in and out same day in order to write the check. --24.61.xxx.xx

I buy a 12 month CD with each security deposit. should they be there more than the 2 years, the interest computation (such as it is) is easy. --72.70.xxx.xx

I don't think we have that law in Indiana. If we do, I'm not aware of it. --99.92.xxx.xxx

--99.56.xx.xx

For your purposes, any separate checking or savings account for deposits should suffice. --50.45.xxx.xx

Tom (FL): Yes, I have done that. thanks. --73.52.xx.xxx

For those that deposit the funds in their general operating account the funds will be treated as regular income so you are paying taxes on money that is not yours. Interesting concept. --71.75.xx.xx

Just go in and tell the bank person behind the desks that you want a landlord tenant account. They don't charge for them and do pay a small interest. You will be the custodian and will receive a statement every so often. You have to let the tenant know before taxes that there is a little bit of interest. --73.178.xxx.xx

In 28 years I had one tenant ask for interest on the SD because I deducted some damages. He was disappointed when he found that interest added up to $20 over 6 years using my banks interest rate. --72.95.xxx.xx

I don't do security deposits anymore. I use move in fee. It's just a little under a months rent. I also tell them how they can make money when they move out (that's where the cleaning list comes in). --71.213.xx.xxx

This way I have to do no accounting..... --47.156.xx.xx

I've found that at least in my area credit unions are much more accommodating than big banks & even smaller local banks at providing & dealing with user friendly escrow accounts for tenant's SDs. --71.174.xx.xx

NC also allows a LL to purchase an insurance bond for the deposits, but I can't find a single insurance company who sells these or even knows what they are. Why it is spelled out so specifically in our laws I don't know. --50.82.xxx.xx

You can also get a surity bond--- when we inquired about how and where to get this bond-- no one knew? --99.103.xxx.xxx

-TonT --73.52.xx.xxx

You don't have to handle it. You can give it to an atty. Fairly common practice here when selling. All earnest funds are handed over to the attorney saves brokers a ton of paperwork.. --71.75.xx.xx

--71.175.xxx.xxx

So now I'm pissed. --73.52.xx.xxx

WILMA I have never heard of a bank requiring the SS or EIN for any of the SD's I deposit. The check is made out to the LLC so not sure why they need the tenants info. --71.75.xx.xx

NC Investor, my Credit Union has the tenant fill out a form so all of the tax info goes directly to them. Since it's the tenant's money, I don't know how having the account in your LLC gives them any protection form yours or your LLC's creditors. --71.174.xx.xx

Here I maintain a separate bank account where all deposits are held. It my case it's a MM account that I can write checks on. As long as you aren't required to keep each deposit in its own separate account something like this should work for you. --70.178.x.xx

Same law here. All SDs are set up in seperate escrow accounts. The idea behind it is that is has to be an account set up with tenants SS# because it is their money. That keeps it clear from your creditors reach. If you do it wrong you risk not being able to deduct from it ( or returning 3x) if judge says so. --71.10.xxx.xxx

I have always held security deposits (and last months' rent) in a tenant escrow account. No problem with my bank (they do it as a passbook or statement account). I thought that was how everyone did it. In Mass. we are supposed to give our tenants the interest on their security deposit and last months' rent each year of their tenancy. I send the $1.33 or whatever with their Holiday card and local restaurant gift certificate (if their on Santa's good list). --71.174.xx.x