Illinois Security Deposit Interest Rules

Does Illinois require interest on security deposits?

Only in some cases. Under the Illinois Security Deposit Interest Act, 765 ILCS 715, a landlord of 25 or more units in a single building or complex must pay interest on a security deposit held for more than 6 months. Landlords with fewer units are not covered by this statute. Chicago has its own ordinance with separate requirements, and other local rules may apply. This page does not cover them.

How the Illinois interest rate works

The statute does not set a fixed percentage. The rate is the rate paid on passbook savings accounts by the largest Illinois commercial bank, measured as of December 31 before the rental agreement began. Interest of $5 or more is paid to the tenant within 30 days after each 12-month period, or on termination of the rental agreement.

What happens if an Illinois landlord does not pay required interest

A landlord who willfully fails or refuses to pay required interest is liable for the amount of the deposit plus court costs and attorney fees.

Chicago and other local rules

Chicago has its own deposit interest ordinance with separate requirements, and other local rules may apply. This page does not summarize them. If your rental is in Chicago or another city or county with its own rules, check the current ordinance or ask a local attorney.

How to use this calculator

Enter the deposit amount and how many months it has been held. The calculator does not compute a dollar amount for Illinois, because the rate follows a statutory formula tied to bank rates when the rental began. Use it to see the rule summary and to check whether your situation (25 or more units, deposit held over 6 months) triggers the state rule.

Frequently asked questions about Illinois deposit interest

Does Illinois require landlords to pay interest on security deposits?

Only in some cases. Under 765 ILCS 715, a landlord of 25 or more units in a single building or complex must pay interest on a security deposit held for more than 6 months. Landlords with fewer units are not covered by this statute. Chicago has its own ordinance with separate requirements, and other local rules may apply.

What is the Illinois deposit interest rate?

The statute sets the rate by formula rather than as a fixed percentage. It is the rate paid on passbook savings accounts by the largest Illinois commercial bank, measured as of December 31 before the rental agreement began.

How often must Illinois deposit interest be paid?

Under 765 ILCS 715, interest of $5 or more is paid to the tenant within 30 days after each 12-month period, or on termination of the rental agreement.

What happens if an Illinois landlord does not pay required interest?

A landlord who willfully fails or refuses to pay required interest is liable for the amount of the deposit plus court costs and attorney fees.

Does Chicago have its own deposit interest rules?

Yes, Chicago has its own ordinance with separate requirements, and other local rules may apply. This page does not summarize them, so check the current ordinance or ask a local attorney if your rental is in Chicago.