Massachusetts Security Deposit Interest Calculator & Escrow Rules
$110.00
Calculated at the statutory rate of 5% per year under M.G.L. c. 186 § 15B(3)(b) (M.G.L. c. 186 § 15B(3)(b)).
Massachusetts Deposit Interest Laws at a Glance (M.G.L. c. 186 § 15B(3)(b))
Payable annually within 30 days after the end of each tenancy year, or may be deducted by tenant from next rental payment.
| Statutory Interest Mandate | Mandatory under state law |
|---|---|
| Statutory Interest Rate | 5% per year (M.G.L. c. 186 § 15B(3)(b)) |
| Minimum Tenancy Duration | 12 months of continuous tenancy |
| Escrow Account & Banking Rule | Must be deposited in a separate, interest-bearing Massachusetts bank account protected from landlord creditors. |
| Governing Statute | M.G.L. c. 186 § 15B(3)(b) ↗ |
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Key Massachusetts Statutory Nuances & Escrow Case Law
- 5% Statutory Benchmark: Landlord must pay 5% annual interest or the actual bank rate if deposited in a compliant MA interest-bearing escrow account.
- Annual Settlement Obligation: Interest must be paid to the tenant annually or credited against rent within 30 days of the tenancy anniversary.
- Tenant Deduction Remedy: If landlord fails to pay interest after 30 days, tenant has the legal right under § 15B(3)(b) to deduct accrued interest from rent.
Boston 1-Year Apartment Security Deposit Interest
$2,400
12 months
$120.00
For a $2,400 deposit held for 12 months under Massachusetts General Laws c. 186 § 15B, the statutory 5% rate yields $120.00 in annual interest owed to the tenant.
Massachusetts Security Deposit Interest FAQs
Are Massachusetts landlords required to pay interest on security deposits?
Yes. Under M.G.L. c. 186 § 15B(3)(b), landlords must pay 5% interest per year or the actual interest rate received from the Massachusetts bank where funds are held.
When must deposit interest be paid in Massachusetts?
Interest must be paid annually on the anniversary of the tenancy. The landlord must provide the payment or allow the tenant to deduct it from rent within 30 days.
What if a Massachusetts landlord fails to pay deposit interest?
Under M.G.L. c. 186 § 15B, if the landlord fails to pay interest within 30 days of the annual deadline, the tenant may deduct the accrued interest from the next rent payment.
Can a landlord keep deposit interest as an administrative fee in Massachusetts?
No. Massachusetts law contains no administrative fee deduction for landlords. All accrued interest must be transferred directly to the tenant.