Security Deposit Accounts
Whenever you accept funds for a security deposit from your tenants, you must also have them complete a W9 form so you can set up a security deposit account at you local bank. This account is held in the tenants name, under their social security number and the tenant is responsible for paying any tax on income earned from the account. Although typical rates are fairly low.Â
While the account is set up in the tenant’s name, they will not be allowed to make withdrawals from the account. Only the person who set up the account can remove money from the account. Â
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