Disclaimer (educational only): This is general educational information, not legal advice. Security deposit disputes are fact-specific and deadlines matter. Consult a qualified California landlord–tenant attorney for guidance on your specific tenancy.
Security deposits are a “small dollar” issue that can turn into a big drain: tenant conflict, negative reviews, and time-consuming disputes. California’s deposit statute (Civil Code § 1950.5) is already detailed—and AB 414 adds new requirements that matter most to modern landlords because so many payments are electronic now.
Key takeaways:
The “big deadline” remains: provide the itemized statement and return the remaining deposit within 21 calendar days after the tenant vacates.
AB 414 changes the method of return: if the landlord received the security or rent payments electronically, the remaining deposit generally must be returned electronically unless another method is agreed in writing.
AB 414 also addresses operational issues like how returns are handled when there are multiple adult tenants and how itemized statements can be delivered.
Good process + documentation reduces the odds a deposit becomes a legal fight.
California statewide law (what AB 414 changes)
AB 414 is a chaptered law that amends Civil Code § 1950.5 (the core California security deposit statute). It was approved by the Governor on October 6, 2025.
California’s Constitution provides that, except for specified categories (including urgency statutes), a statute enacted at a regular session generally goes into effect on January 1 following the relevant enactment timeline.
What changed vs. prior law (high-level, per Legislative Counsel digest):
Existing law required the remaining deposit to be returned by personal delivery or first-class mail within 21 days, and it allowed the landlord/tenant to mutually agree to electronic return/delivery in certain circumstances.
AB 414 revises those provisions to generally require return by personal delivery or check, but if the landlord received the security or rental payments electronically, AB 414 requires the return to be electronic (unless another method is designated by written agreement).
AB 414 also requires a written notice about the tenant’s right to receive the security electronically when the landlord receives payments electronically.
The rule landlords feel most: “How did you take the rent?” now drives “How must you refund?”
Civil Code § 1950.5(h)(1) still requires completing the statement and return of any remaining portion of the security within 21 calendar days after the tenant vacates.
But AB 414’s updated language adds a major operational branch:
- If the landlord received the security or rent electronically, return the remainder electronically to a designated account or electronic/virtual method if agreed in writing (unless the parties have a different written agreement).
Why this matters: A landlord who defaults to “mail a check to the last known address” may now be out of process in scenarios where electronic payment history triggers electronic refund obligations (unless another method was designated in writing).
Multiple adult tenants (a frequent pain point)
AB 414’s digest confirms that if multiple adult tenants reside in the unit, the law requires security return via a check payable to all adult tenants (unless there’s a mutual written agreement with specific provisions), and it addresses how landlords can provide the itemized statement.
Practical takeaway: Don’t wait until move-out to discover you don’t have a clean, agreed method for deposit returns when roommates split. (General practice note; consult counsel on drafting.)
Reminder: deposit return rules sit inside a bigger compliance framework
Even beyond AB 414’s new logistics, Civil Code § 1950.5 contains other operational rules landlords should consistently follow (like providing documentation for deductions and supporting detail).
If you want your move-out, accounting, and deposit policies aligned to 2026 law changes, schedule a property management consult with Harland Property Management (Investors: 858-537-1681).
San Diego callout
AB 414 is statewide. No San Diego-specific overlay confirmed for AB 414 itself (it amends California Civil Code § 1950.5).
Local note for City of San Diego landlords: If your property is inside City limits, also be aware of separate City rules affecting termination/eviction processes under the Residential Tenant Protections Ordinance (SDMC §§ 98.0701–98.0709), which is separate from security deposit return law.
Want deposit compliance handled consistently—every time, for every move-out? Get a custom management quote or schedule a property management consult with Harland Property Management (Investors: 858-537-1681).
Disclaimer (educational only): This article is not legal advice. Deposit disputes can be highly fact-specific; consult a qualified attorney for advice about your situation.
AB 414 deposit-return checklist (practical, system-based):
At move-in: document how rent and deposits are paid (electronic vs non-electronic) so you can apply the correct refund method later.
At move-out notice: confirm in writing the tenant’s “deposit return destination” (bank account/virtual method/address), consistent with AB 414’s written-agreement option.
If multiple adult tenants: confirm who receives the itemized statement and how the refund check is titled, consistent with AB 414’s multi-tenant provisions.
Build a “Day 0–21” calendar: inspection, invoices/estimates, itemized statement, refund issuance within 21 days.
Train staff/vendors to deliver bids/invoices fast enough to support the 21-day deadline, and use allowable estimating rules where applicable (see Civil Code §1950.5).
FAQs
Q: Is the deposit return deadline still 21 days?
A: Yes. Civil Code § 1950.5 requires the landlord to furnish the itemized statement and return any remaining portion within 21 calendar days after the tenant vacates.
Q: What’s new in AB 414 in one sentence?
A: AB 414 changes how the refund is delivered/returned, especially when the landlord received payments electronically, and updates related delivery rules and multi-tenant
handling.
Q: If the tenant paid rent electronically, can the landlord still mail a check?
A: AB 414’s text requires electronic return in that scenario unless another method is designated by written agreement.
Q: Does AB 414 require landlords to notify tenants about electronic return rights?
A: Yes—AB 414’s digest describes a requirement to notify the tenant in writing of the right to receive the security electronically when the landlord receives payments electronically.
Q: How does AB 414 handle multiple adult tenants?
A: The digest indicates checks are generally payable to all adult tenants unless there is a specified written agreement, and it addresses how statements can be delivered.
Q: Is there a San Diego-specific rule about AB 414?
A: No San Diego-specific overlay is confirmed for AB 414 itself; it is a statewide Civil Code change.
