Philadelphia Security Deposit Rules: What the Security Deposit Installment Ordinance Adds to Pennsylvania Law

A landlord in Philadelphia has to satisfy two sets of rules at once: the Pennsylvania statute, 68 P.S. § 250.512, and the city's own Security Deposit Installment Ordinance (Phila. Code § 9-804(4)(b)). The state law sets the 30-day return deadline after termination of the lease or surrender and acceptance of the premises; the local ordinance adds a rule on paying the deposit in installments. Where the two overlap, the landlord has to meet the stricter one.

What the Security Deposit Installment Ordinance adds

• Paying the deposit in installments: Where the security deposit for the first year of the tenancy exceeds one month's rent, the tenant — not the landlord — picks how to pay it: either as a lump sum, or in installments made up of one month's rent paid up front with the remainder in three equal payments, due no more often than once a month, starting the month after the tenancy begins. The total may not go up for choosing installments. A landlord operating or managing two or fewer rental units is exempt from the installment right, and ownership is aggregated across every entity a person holds an interest in, so separately titled properties run by substantially the same people count together. A tenant whose landlord breaks the deposit rules can recover actual damages or, by electing before judgment, one month's rent as statutory damages, plus reasonable attorney's fees and costs. (9-804(4)(b), exemption at 9-804(4)(b)(.1), remedies at 9-804(16))

Who it covers: Residential landlords, owners, agents and managers in Philadelphia. The installment right at § 9-804(4)(b) exempts anyone operating or managing two (2) or fewer rental units, but the deposit cap at § 9-804(4)(a) and the rest of § 9-804 bind every landlord regardless of size.
Worth knowing: The deposit cap in Philadelphia is still state law: § 9-804(4)(a) simply forbids charging more than 68 P.S. § 250.511a allows, which is two months' rent in the first year and one month from the second year on — which is why the installment right is written around a first-year deposit above one month's rent. Two dates matter and they differ: the ordinance took effect December 2, 2025, but by its own terms it applies to any residential lease executed or renewed after it was adopted into law on September 3, 2025. The remedies subsection is numbered (16) in the codified Code even though the enrolled bill numbered it (15), because a no-waiver provision already occupied (15) — citing "9-804(15)" off the bill PDF points at the wrong subsection. A deposit violation is also an unfair rental practice under § 9-802(5), which opens an administrative route to the Fair Housing Commission under § 9-804(14). The codified text behind this summary was read from an archived copy of the City's code publisher, which blocks automated requests; the only later Chapter 9-800 ordinance, Bill No. 250330-AA (effective Nov. 1, 2026), does not touch § 9-804(4).

What Pennsylvania law already requires

• Return deadline: 30 days after termination of the lease or surrender and acceptance of the premises.
• Itemized deductions: required in writing. The tenant must give the landlord a new address in writing to claim the double-damages penalty.
• Forwarding address: the tenant should give one in writing; it affects the deadline or the remedy.
• Penalty for wrongful withholding: A landlord who fails to send the itemized list within 30 days forfeits the right to withhold and is liable for double the amount wrongfully withheld.
• Deposit cap: Two months' rent during the first year; one month's rent after the first year.
• Interest: From the third year, deposits over $100 must be held in escrow and the interest (minus a 1% fee) paid to the tenant annually.
• Small claims limit: $12,000.
• Statute: 68 P.S. § 250.512.

Using both rules together

1. Read the lease for the deposit amount, the move-in date, and any clause that mentions the ordinance.
2. Check the local rule first: paying the deposit in installments under Phila. Code § 9-804(4)(b).
3. Count the Pennsylvania deadline of 30 days from termination of the lease or surrender and acceptance of the premises.
4. A written demand that cites both 68 P.S. § 250.512 and Phila. Code § 9-804(4)(b) carries more weight than one that cites either alone. A landlord who fails to send the itemized list within 30 days forfeits the right to withhold and is liable for double the amount wrongfully withheld.

Frequently Asked Questions

Q: Does Philadelphia require interest on security deposits?
A: The Security Deposit Installment Ordinance does not add an interest rule, so Pennsylvania law governs. From the third year, deposits over $100 must be held in escrow and the interest (minus a 1% fee) paid to the tenant annually.

Q: Is the Philadelphia deposit return deadline different from Pennsylvania law?
A: No. The Security Deposit Installment Ordinance does not change the return deadline, so the Pennsylvania rule applies: 30 days after termination of the lease or surrender and acceptance of the premises under 68 P.S. § 250.512.

Q: Does the Security Deposit Installment Ordinance apply to my unit?
A: Residential landlords, owners, agents and managers in Philadelphia. The installment right at § 9-804(4)(b) exempts anyone operating or managing two (2) or fewer rental units, but the deposit cap at § 9-804(4)(a) and the rest of § 9-804 bind every landlord regardless of size. Check the section cited below for the full list of exemptions before relying on it.

Q: Can I sue my landlord in small claims court for my Pennsylvania deposit?
A: Yes. Pennsylvania small claims court hears claims up to $12,000, which covers most deposits plus the statutory penalty. A dated written demand that cites 68 P.S. § 250.512 is the usual first exhibit.

Sources Checked

• Phila. Code § 9-804(4) (Security Deposits), small-landlord exemption at § 9-804(4)(b)(.1), no-waiver rule at § 9-804(15) and remedies at § 9-804(16); added by Bill No. 250044-A, approved Sept. 3, 2025, effective Dec. 2, 2025, Security Deposit Installment Ordinance: code text, read 2026-09-20
• 68 P.S. § 250.512 (the Pennsylvania statute cited above)
• LeaseLenses Pennsylvania deposit data set, last reviewed 2026-09-19; the same data powers the Pennsylvania demand letter tool
• Pennsylvania landlord-tenant overview and the Pennsylvania deposit rules page

This page is general legal information for Philadelphia, Pennsylvania, not legal advice. Local ordinances are amended more often than state statutes; read the current code text before relying on a figure in court.