I recently went to my bank where I keep my tenants accounts at to obtain a letter stating the amount of the security deposit ,the banks name and account number that I provide my tenants with. When I inquired about this letter I was told by the banker that I needed to have a 1099 form filled out with my tenants information. The reason I was told was that the savings account that i was using to hold my tenants security deposit in needed to be transferred to a Tenant Security Deposit account with the tenants name on the account. My question.Is a separate interest bearing savings account sufficient enough for holding a tenant security deposit or do I need to have a Tenant Security Deposit(as per my bank) in the tenants name? What are the pros and cons of each account?
@Lamont Booth , check this website out, it gets into state specific laws. Hope it helps
Thanks for the help.