Landlord Security Deposit Question
I have researched this topic and just need a little further verification from more experienced professionals than myself. I will be renting out my first property. When I receive the security deposit I understand that the funds must be deposited and not commingled with my personal funds. Now I have an account with a bank and have multiple accounts within that bank. So if I were to open another savings account within that bank would that be considered commingling or do I need to open this account in a separate bank? The reason being is I can see all of my accounts from the same login screen online and I can easily transfer money back and forth so I don't know if that would be considered commingling or not. Here is the Iowa law on the issue:
562A.12 Rental deposits. 1. A landlord shall not demand or receive as a security deposit an amount or value in excess of two months’ rent. 2. All rental deposits shall be held by the landlord for the tenant, who is a party to the agreement, in a bank or savings and loan association or credit union which is insured by an agency of the federal government. Rental deposits shall not be commingled with the personal funds of the landlord. Notwithstanding the provisions of chapter 543B, all rental deposits may be held in a trust account, which may be a common trust account and which may be an interest-bearing account. Any interest earned on a rental deposit during the first five years of a tenancy shall be the property of the landlord.
Thanks for the help! Great site with helpful people! I have considered setting up an LLC but as of right now this is the only property I will be renting and I don't know that it would be necessary right now. Plus since I have a mortgage on the property I am aware of the due on sale clause which I know is very unlikely but still is a possibility so I don't that an LLC would be an option anyway so for time being I just planned on having the funds in an account under my name.