Thousands in deposit; is that fair?

Question: A previous column addressed an apartment owner’s concerns over allowing a tenant to install a satellite dish. I am a renter and have a question concerning my apartment community’s policy of requiring renters to submit $350 damage deposits if they want to install dishes. Satellite may be a better deal than cable on the face of it, but I don’t think it will be if I have to pay the apartment owner another $350 in deposit money. Also, if I pay the added deposit, they’ll have $4,000 of my money held in deposit. Is this legal?

Answer: Apartment owners can charge extra deposits for extra services or privileges, such as having a satellite dish installed. However, there are limits on how much total deposit money owners can require from renters. Under state law, security deposits are limited to two months’ rent for unfurnished apartments and three months’ for furnished.

Therefore, if you live in an unfurnished apartment and your rent is $2,000 per month or higher, the owner’s request for extra deposit money that makes the total amount of the deposit $4,000 is legal. If the monthly rent is less than $2,000, the owner’s request for additional deposit money that exceeds two times the monthly rent violates state law and is illegal.

Also, remember that all security deposits for residential rentals in California are fully refundable assuming there are no damages, unpaid rent or cleaning charges. Their purpose is merely to ensure that owners will at least be partly reimbursed if damages do occur.

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Rental property and tax write-offs

Question: I own a duplex in Highland Park that I rent out. Are all of the expenses that I incur on the duplex throughout the year tax write-offs? Do I get any kind of a tax credit at the end of the year for owning rentals?

Answer: Hire a good tax accountant for detailed answers to your tax questions.

It is my experience that almost all of the expenses you incur on rental property throughout the year are tax write-offs. The big exception to the rule is the principal payments that you make on your mortgage. They cannot be written off. Mortgage interest payments, on the other hand, are tax write-offs. Also, if you occupy one of the rentals, you cannot write off the expenses related to it. You also get tax benefits on the property through depreciation.

There are generally no tax credits for owning apartments. However, there are some tax credits available for those who build new low-income rental housing.

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$300 painting charge a good deal

Question: I have lived in my two-bedroom Pasadena apartment for several years and I would like to have it painted again. The owner is willing to paint, but he wants to charge me $300 to move the furniture. When he painted the apartment for me seven years ago, he charged me $275 to move the furniture. Is this legal?

Answer: It is legal for the owner to charge extra for special services, such as repainting an apartment or preparing an apartment for repainting. Since you don’t mention the actual cost of the painting, I assume the owner is paying and that the cost is a lot more than $300 for a two-bedroom apartment.

While you may not perceive painting as an extra service, it really is. The owner did not benefit from the painting he did for you seven years ago. You benefited. Therefore, for him to pick up the entire cost of the actual painting and only charge for moving the furniture is a pretty good deal.

While it is common for owners to split some or all of the costs of things like painting with existing renters, it is not mandatory.

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Postema is the editor of Apartment Age magazine, a publication of the Apartment Assn. of Greater Los Angeles, an apartment owners’ service group. E-mail questions about apartment living to AptlifeAAGLA@aol.com, c/o Kevin Postema, or mail to AAGLA, c/o Kevin Postema, 621 S. Westmoreland Ave., Los Angeles, CA 90005.