Does the deposit have to be in an interest-bearing account in Tennessee?

No statute addresses whether the account must bear interest. In the counties where Tennessee's landlord-tenant act applies, the landlord must hold deposits in the account required by § 66-28-301(a), and must tell the tenant where that account is — but not its number. The disclosure duty in its current form comes from 2012 Public Chapter 887, which replaced subsection (h) with: "Notwithstanding the provisions of subsection (a), all landlords of residential property shall be required to notify their tenants at the time such persons sign the lease and submit the security deposit, of the location of the account required to be maintained pursuant to this section, but shall not be required to provide the account number to such persons."

What happens if a landlord does not pay deposit interest in Tennessee?

No penalty reaches deposit interest, because no interest is owed. The account duty is enforced by forfeiting the right to withhold.

Do any cities or counties in Tennessee have their own deposit-interest rules?

Tennessee's landlord-tenant act does not reach the whole state: § 66-28-102(a) applies the chapter only in counties having a population of more than 75,000 according to the 2010 federal census. That county list is frozen on purpose.

Does a landlord have to pay interest on a security deposit in Tennessee?

Verified August 28, 2026 All Tennessee topics →

What did not become law. None of the following is law; failed bills are sometimes still described as if enacted:

SB 961 / HB 955 (114th General Assembly) — 'Affordable Housing and Tenant Protection Act' — Would repeal the residential half of the rent-control preemption in T.C.A. § 66-35-102, allowing local rent control adopted by a two-thirds vote with a local rent agency, plus a THDA gap-financing program. Would end the statewide preemption of local residential rent regulation if ever enacted. Status: Not enacted. HB 955 was deferred in the House Cities & Counties Subcommittee to the 'January 2027 calendar' on 2026-03-18 — with the 114th GA adjourned sine die, this is effectively a soft kill; watch for a 115th GA refile. (checked July 9, 2026).

Tennessee does not require landlords to pay tenants interest on a security deposit, and every modern rewrite of the deposit section is silent on the subject.

Cited to 2012 Tenn. Pub. Ch. 887 (HB 2913) — substitutes T.C.A. § 66-28-301(h), the account-location notice § 1 and 3 more cited sources · Verified August 28, 2026

The state does require an account, and requires the landlord to say where it is: in the counties where Tennessee's landlord-tenant act applies, the landlord must notify the tenant, when the lease is signed and the deposit paid, of the location of the account holding the deposit, but "shall not be required to provide the account number". The account provision names no yield and no earnings, and the disclosure duty is narrower than Kentucky's, which requires the number as well. Coverage matters as much as content here: the act reaches only counties above a population threshold that the legislature deliberately froze in 2021, and outside those counties Tennessee has no security-deposit statute at all.

Tennessee deposit interest at a glance

Interest owed to the tenant	No — no statute addresses it
How the rate is set	No rate exists — there is no interest duty
Current figure	No published figure exists
Rate rules	No rate rules — no duty exists
Accrual and payment	No payment duty exists
Who and what is covered	No statutory conditions stated — see the summary and notes
Statute controls where or how the deposit is held	Yes
Interest-bearing account required	No statute addresses whether the account must bear interest
Custody rules	In the counties where Tennessee's landlord-tenant act applies, the landlord must hold deposits in the account required by § 66-28-301(a), and must tell the tenant where that account is — but not its number. The disclosure duty in its current form comes from 2012 Public Chapter 887, which replaced subsection (h) with: "Notwithstanding the provisions of subsection (a), all landlords of residential property shall be required to notify their tenants at the time such persons sign the lease and submit the security deposit, of the location of the account required to be maintained pursuant to this section, but shall not be required to provide the account number to such persons." Neither that subsection nor the 2011 rewrite of subsection (c) attaches any interest, earnings or yield condition to the account, and neither act uses the word "interest" at all.
Penalty for violation	No penalty reaches deposit interest, because no interest is owed. The account duty is enforced by forfeiting the right to withhold. Subsection (c), as substituted by 2011 Public Chapter 272, reads: "No landlord shall be entitled to retain any portion of a security deposit if the security deposit was not deposited in an account as required by subsection (a) and a listing of damages is not provided as required by subsection (b)."
Local rules	Tennessee's landlord-tenant act does not reach the whole state: § 66-28-102(a) applies the chapter only in counties having a population of more than 75,000 according to the 2010 federal census. That county list is frozen on purpose. In 2021 the General Assembly deleted the words "or any subsequent federal census" from the subsection, so the 2020 census neither did nor could add counties — coverage now changes only when the legislature changes it (2021 Public Chapter 182, § 2, effective July 1, 2021). The same act added a preemption rule: in the counties where the chapter applies, it "occupies and preempts the entire field of legislation concerning the regulation of landlords and tenants", and the governing body of a county subject to the chapter "shall not enact or enforce regulations that conflict with, or are an addition to, this chapter". Outside the covered counties there is no state security-deposit statute at all.

Cite this page: "Landlord Atlas, Tennessee Security Deposit Interest Laws (verified August 28, 2026), landlordatlas.com/laws/deposit-interest/tennessee/" — free to cite and quote with a link (how these records are verified). Everything above is cited in the citations section below.

Check the verified Tennessee answer — and every state and city that differs — in the deposit interest calculator — free, no signup, built on the same verified Tennessee law as this page.

Notes and caveats

The disclosure duty, in the words that enacted it — 2012 Public Chapter 887, § 1, deleted subsection (h) of § 66-28-301 and substituted: "Notwithstanding the provisions of subsection (a), all landlords of residential property shall be required to notify their tenants at the time such persons sign the lease and submit the security deposit, of the location of the account required to be maintained pursuant to this section, but shall not be required to provide the account number to such persons." The subsection is about identifying where the money is, and expressly stops short of the account number.
Forfeiting the right to withhold — 2011 Public Chapter 272, § 8, deleted subsection (c) of § 66-28-301 and substituted: "No landlord shall be entitled to retain any portion of a security deposit if the security deposit was not deposited in an account as required by subsection (a) and a listing of damages is not provided as required by subsection (b)." The sanction presupposes and enforces the account duty in subsection (a).
The county coverage was frozen on purpose — 2021 Public Chapter 182, § 2, amended § 66-28-102(a) "by deleting the language 'or any subsequent federal census'", effective July 1, 2021. Before that the threshold was rolling: it named a census year and carried the phrase, so each new decennial census could add counties. The General Assembly's response to the 2020 census was to remove the rolling clause. A county list keyed to the 2010 census is therefore current law rather than a stale figure — the opposite of the usual worry about census-based thresholds.
What is not in the chapter — The acts that rewrote § 66-28-301 in 2011 and 2012, the 2021 act amending § 66-28-102 and the 2024 act amending § 66-28-302 contain no interest, escrow or interest-bearing language of any kind. Two measures touching deposits in recent sessions — one that would have required landlords to accept rental-security insurance or a bond in lieu of a deposit, one that would have created a rental fee-transparency chapter — are likewise free of any interest provision, and neither became law.
Currency — No act amending § 66-28-301 or § 66-28-102 has been located after 2021 Public Chapter 182. The most recent located act touching chapter 66-28 is 2024 Public Chapter 907, which reaches § 66-28-302 only and carries no interest language.

Common questions: Tennessee deposit interest

Each answer is the verified value from the table above, restated as a direct answer. Free to quote with a link to this page.

What is the Tennessee security deposit interest rate right now?: No published figure exists.
When must a landlord pay or credit deposit interest in Tennessee?: No payment duty exists.
Does the deposit have to be in an interest-bearing account in Tennessee?: No statute addresses whether the account must bear interest. In the counties where Tennessee's landlord-tenant act applies, the landlord must hold deposits in the account required by § 66-28-301(a), and must tell the tenant where that account is — but not its number. The disclosure duty in its current form comes from 2012 Public Chapter 887, which replaced subsection (h) with: "Notwithstanding the provisions of subsection (a), all landlords of residential property shall be required to notify their tenants at the time such persons sign the lease and submit the security deposit, of the location of the account required to be maintained pursuant to this section, but shall not be required to provide the account number to such persons."
What happens if a landlord does not pay deposit interest in Tennessee?: No penalty reaches deposit interest, because no interest is owed. The account duty is enforced by forfeiting the right to withhold.
Do any cities or counties in Tennessee have their own deposit-interest rules?: Tennessee's landlord-tenant act does not reach the whole state: § 66-28-102(a) applies the chapter only in counties having a population of more than 75,000 according to the 2010 federal census. That county list is frozen on purpose.

Citations

2012 Tenn. Pub. Ch. 887 (HB 2913) — substitutes T.C.A. § 66-28-301(h), the account-location notice · § 1 (verified 2026) Official source
2011 Tenn. Pub. Ch. 272 (HB 1760) — substitutes T.C.A. § 66-28-301(c) · §§ 7-8 (verified 2026) Official source
2021 Tenn. Pub. Ch. 182 (HB 716) — amends T.C.A. § 66-28-102 (county coverage frozen; county preemption) · §§ 1-2 (verified 2026) Official source
Tenn. Code Ann. § 66-28-301 (official code access) · (a), (c), (h) (verified 2026) Official source

How this record was verified: Direct read of the official session laws that constitute every located modern amendment to Tennessee's deposit and coverage provisions, each read in full from the Secretary of State's published acts: 2011 Public Chapter 272, which rewrote § 66-28-301(c) and struck the last sentence of § 66-28-301(a); 2012 Public Chapter 887, which substituted § 66-28-301(h); 2021 Public Chapter 182, which amended § 66-28-102; and 2024 Public Chapter 907, the most recent located act touching chapter 66-28, which reaches § 66-28-302 only. Each act searched for "interest", "escrow" and "bearing", returning no occurrences in any of them. Two non-enacted measures touching deposits — one on rental-security insurance and bonds in lieu of a deposit, one creating a rental fee-transparency chapter — also read in full and likewise free of any interest provision. Tennessee publishes its official electronic code only through a portal that requires a live session, so a search across the compiled chapter as published could not be run; the account and disclosure duties are stated from the enacting acts themselves.