Pennsylvania Security Deposit Interest Calculator & Escrow Rules
In Pennsylvania, interest reflects actual bank yield less a 1% landlord administrative fee.
$0.00
Tenancy duration of 12 months is under Pennsylvania's statutory minimum of 24 months required to accrue interest under 68 P.S. § 250.511b.
Pennsylvania Deposit Interest Laws at a Glance (68 P.S. § 250.511b)
Paid annually to the tenant beginning on the anniversary of the 2nd full year of tenancy.
| Statutory Interest Mandate | Mandatory under state law |
|---|---|
| Statutory Interest Rate | 2% per year (68 P.S. § 250.511b(b)) |
| Minimum Tenancy Duration | 24 months of continuous tenancy |
| Escrow Account & Banking Rule | Must be deposited in an escrow account in an institution regulated by the Federal Reserve Board or Pennsylvania Department of Banking. |
| Governing Statute | 68 P.S. § 250.511b ↗ |
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Key Pennsylvania Statutory Nuances & Escrow Case Law
- Two-Year Moratorium: Under 68 P.S. § 250.511b(b), no interest is owed during the first two years of tenancy; interest begins accruing on the third year.
- 1% Landlord Administrative Deduction: The landlord is entitled to retain 1% per year of the deposit amount for escrow administrative fees.
- Escrow Notice Requirement: Landlord must notify tenant in writing of the banking institution name and address where deposit funds are maintained.
Philadelphia 3-Year Tenancy Escrow Interest
$1,600
36 months
$16.00
Under 68 P.S. § 250.511b, interest applies only to year 3 (months 25-36). At a 2% bank yield ($32), landlord retains 1% admin fee ($16), paying $16.00 net interest to the tenant.
Pennsylvania Security Deposit Interest FAQs
Are Pennsylvania landlords required to pay interest on deposits?
Yes, but only after the tenant has lived in the property for more than two years under 68 P.S. § 250.511b(b).
Do Pennsylvania tenants get interest during the first two years?
No. Pennsylvania law explicitly exempts landlords from paying interest during the first 24 months of tenancy.
How much administrative fee can a Pennsylvania landlord deduct?
Under 68 P.S. § 250.511b(b), the landlord may deduct 1% of the deposit amount annually for administrative expenses.
Must Pennsylvania landlords use an escrow account?
Yes. Deposits over $100 held for more than two years must be placed in a regulated interest-bearing escrow account in Pennsylvania.