What should I do with a damage deposit?

[Connor Wentling]

Hello BP community,

I'm closing on my first investment property this month and have lined up a tenant for one year. My plan is to collect one month's rent as a damage deposit. That seems to be a standard approach, but I'm curious what your thoughts are.

Are there any unique restrictions on managing the damage deposit? Can I place the money in a business checking account or does it need some other line of tracking? 

Thanks for your time and advice!

Connor