Your tenant sits across from you, looking uncomfortable. “I got a job transfer to Phoenix,” they explain. “I know we signed a 12-month lease, but I need to move out next month. Can we work something out? Maybe you can just keep my security deposit, and we call it even?”
You’re thinking through the math quickly. The $1,800 security deposit sounds like easy money, but is it enough? There’s 8 months left on the lease at $1,500 per month. You’ll need time to find a new tenant, maybe some repairs or cleaning, advertising costs, and who knows how long the property might sit vacant in the current market.
Meanwhile, your tenant is hoping for a clean break that doesn’t destroy their credit or rental history. They seem reasonable and willing to cooperate, which could make this easier than a hostile eviction situation.
So what can you legally keep? What are your actual costs likely to be? And is negotiating a settlement better than enforcing the full lease and risking months of legal battles with someone who’s already moving to another state?
The answers depend on understanding Nevada’s specific laws about lease termination, security deposit use, and what costs you can actually prove versus what you hope to recover.
NOT LEGAL ADVICE: This information is for educational purposes only and should not be considered legal advice. Nevada lease termination and security deposit laws are complex and fact-specific. For specific legal questions, consult with a Nevada-licensed attorney.
Nevada Law: What You Can Actually Keep
Nevada’s security deposit law is specific about when and how much you can retain from a tenant’s deposit. Under Nevada Revised Statute 118A.242, landlords can only keep deposits for legitimate, documented costs – not as automatic penalties for lease breaking (see NRS 118A.242(1)-(4)).
Legitimate Uses of Security Deposits for Early Termination:
- Unpaid rent through the date of actual vacancy
- Property damage beyond normal wear and tear
- Reasonable cleaning costs to restore rent-ready condition
- Advertising and marketing costs to re-rent the property
- Lost rent during reasonable vacancy periods (with limitations)
What You CANNOT Keep Automatically:
- Entire deposit as a “lease break penalty”
- Speculative damages without documented losses
- Full remaining lease payments without mitigation efforts
- Punitive amounts beyond actual costs incurred
- Normal wear and tear repairs or maintenance
Critical legal requirement: Nevada law requires landlords to make reasonable efforts to re-rent properties quickly, which limits how much lost rent you can recover from security deposits.
The Mitigation Requirement: Your Legal Obligation
Here’s where many landlords get surprised: Nevada law doesn’t let you sit back and collect rent from both the departing tenant’s deposit and a new tenant. You have a legal duty to “mitigate damages” by trying to re-rent the property promptly.
What Mitigation Means in Practice:
- Advertise the property at reasonable market rates
- Show the unit to prospective tenants promptly
- Accept qualified tenants who meet your standard criteria
- Make necessary repairs to maintain marketable condition
Nevada courts apply the general duty-to-mitigate rule (Restatement 2d Contracts § 350; see El Jefe LLC v. Ochoa, Nev. App. 2020)—landlords must prove they tried to re-rent.
How Mitigation Affects Your Recovery:
If you re-rent within 2 weeks of vacancy, you can only keep the deposit for actual costs plus 2 weeks of lost rent. If it takes 2 months to re-rent, you need to document why (market conditions, necessary repairs, reasonable marketing time) to justify keeping more of the deposit.
Documentation requirement: Courts expect landlords to prove their mitigation efforts with advertising records, showing logs, and evidence that they didn’t unreasonably reject qualified applicants.
Calculating Your Actual Costs
Before deciding whether to keep the deposit, negotiate a settlement, or enforce the full lease, you need realistic cost projections:
Immediate Costs Upon Vacancy:
- Final utility readings and account transfers
- Property cleaning to a rent-ready condition
- Minor repairs and maintenance items
- Professional photography for marketing
- Locksmith services for new keys
Typical range: $300-800, depending on property condition and cleaning needs
Marketing and Re-Rental Costs:
- Online listing fees (Zillow, Rentals.com, etc.)
- Professional photography and virtual tours
- Yard signs and printed marketing materials
- Credit checks and application processing for new tenants
Typical range: $200-500 for a professional marketing campaign
Lost Rent During Vacancy:
- Days on market in your area and price range
- Seasonal factors affecting Las Vegas rental demand
- Property condition and competitive positioning
- Your responsiveness to showing requests and applications
Las Vegas averages: 15-45 days vacancy for well-priced, well-maintained properties
Property Condition Factors:
- Deep cleaning beyond the tenant’s departure condition
- Paint touch-ups or full repainting needs
- Carpet cleaning or replacement requirements
- Appliance servicing or repairs needed for new tenants
Variable range: $500-3,000 depending on property condition and upgrade needs
The Math: Security Deposit vs. Full Lease Enforcement
Let’s work through a realistic example to show the financial decision process:
Scenario:
- Monthly rent: $1,500
- Security deposit: $1,800
- Remaining lease term: 8 months
- Total remaining rent: $12,000
Option 1: Keep Deposit, Release Tenant
Costs covered by $1,800 deposit:
- Cleaning and minor repairs: $600
- Marketing and re-rental: $400
- Lost rent (30 days): $1,500
- Total costs: $2,500
- Your shortfall: $700
Option 2: Enforce Full Lease
Potential recovery if you win:
- Full remaining rent: $12,000
- Keep security deposit: $1,800
- Total potential: $13,800
Risks and additional costs:
- Legal fees: $2,500-5,000
- Lost rent during legal process: $3,000-6,000
- Collection challenges: Tenant in a different state
- Time and stress: 6+ months of litigation
- Net recovery after costs: $3,300-6,300 (if you collect)
Option 3: Negotiate Settlement
Possible negotiated amount: $3,000-4,500
- Tenant pays an additional amount beyond the deposit
- Quick resolution with cooperative tenant
- Immediate ability to re-market property
- Net result: Better than deposit alone, less risk than full enforcement
Business reality: Many experienced landlords find negotiated settlements provide better risk-adjusted returns than either automatic deposit forfeiture or full lease enforcement.
Tenant Cooperation vs. Hostile Lease Breaks
The tenant’s attitude and cooperation level significantly affects your decision-making:
Cooperative Early Termination (Your Scenario):
Tenant advantages:
- Willing to maintain the property during the showing period
- Provides adequate notice for marketing planning
- Cooperative with showing the schedule and property access
- Leaves the property in good condition
Landlord benefits:
- Faster re-rental due to tenant cooperation
- Lower property preparation costs
- Reduced legal and collection risks
- Better tenant references for future landlords
Hostile Abandonment Situations:
Common problems:
- Tenant disappears without notice
- Property left in poor condition or damaged
- No forwarding address for deposit return or collection
- Possible need for formal eviction proceedings anyway
Increased landlord costs:
- Property securing and damage assessment
- Legal fees for abandonment procedures
- Extended vacancy due to property condition
- Collection difficulties with uncooperative tenants
Strategic consideration: Cooperative tenants requesting early termination often present better financial outcomes than hostile situations, even when you keep less money upfront.
Special Lease Termination Situations
Nevada law provides specific protections for certain tenant situations that affect your deposit retention rights:
Military Service Members (SCRA Protection):
- Deployment orders or permanent change of station
- 30-day notice requirement with proper documentation
- Limited landlord ability to charge early termination penalties
- Security deposit return required unless actual damages exist
Domestic Violence Situations:
- Nevada law allows early termination with proper documentation
- Restraining orders or police reports supporting termination
- 30-day notice with required legal documentation
- Security deposit return required except for actual property damages
Uninhabitable Conditions:
- Landlord failure to maintain habitability may justify tenant’s departure
- Constructive eviction claims limit deposit retention rights
- Documentation of habitability issues required by the tenant
- Potential landlord liability beyond deposit return
Legal complexity: These situations require careful legal analysis and often benefit from professional legal consultation rather than DIY handling.
The 30-Day Return Deadline Challenge
Nevada’s security deposit return requirements create practical challenges for early lease termination situations:
Standard Timeline Requirements:
- 30 days maximum to return deposit after termination (NRS 118A.242(4))
- Itemized accounting required for any deductions
- Actual cost documentation with receipts or estimates
Early Termination Complications:
- Unknown re-rental costs within a 30-day deadline
- Estimated damages vs. actual costs incurred
- Marketing timeline extending beyond the deposit return deadline
- Vacancy period uncertainty affecting damage calculations
Practical Solutions:
- Hold a reasonable amount for documented costs
- Return excess promptly with detailed accounting
- Communicate clearly with the tenant about expected costs
- Document everything for potential future adjustments
Professional advantage: Experienced property managers can accurately estimate costs and provide proper accounting within legal deadlines, avoiding technical violations that forfeit deposit retention rights.
Negotiation Strategies That Work
When tenants request early termination, professional negotiation often produces better outcomes than rigid lease enforcement:
Tenant-Favorable Scenarios:
- Job transfers or family emergencies creating genuine hardship
- Cooperative attitude and willingness to assist with transition
- Property maintenance and condition during occupancy
- Advance notice allowing marketing preparation
Landlord-Favorable Terms:
- Graduated penalties based on the remaining lease term
- Property condition requirements for reduced penalties
- Showing cooperation during the marketing period
- Marketing assistance through the tenant’s network or social media
Win-Win Structures:
- Partial penalty beyond security deposit (less than full lease)
- Flexible move-out timing coordinated with new tenant availability
- Reference agreements supporting the tenant’s future rental applications
- Property care standards during the transition period
Communication framework: Professional property managers often facilitate these negotiations, removing emotional elements and focusing on business terms that work for both parties.
Market Timing and Las Vegas Rental Conditions
Las Vegas rental market conditions significantly affect the financial analysis of early lease termination:
Peak Rental Season (March-June):
- Faster re-rental timelines reduce lost rent calculations
- Higher demand may support rent increases for new leases
- Competitive market making quality properties rent quickly
- Seasonal opportunity to update or improve properties between tenants
Slower Rental Periods (July-August, December-January):
- Extended vacancy periods increase actual costs
- Rental concessions may be needed to attract new tenants
- Seasonal challenges affecting showing schedules and tenant interest
- Cost considerations for carrying properties through slow periods
Economic and Market Factors:
- Employment conditions affecting the tenant pool and rental demand
- Interest rates influencing buying vs. renting decisions
- New construction availability affecting rental competition
- Population growth patterns in Las Vegas affecting demand
Market knowledge: Professional property managers track these conditions and can provide realistic vacancy and re-rental projections for financial decision-making.
Documentation and Legal Protection
Whether you negotiate a settlement or enforce the lease, proper documentation protects your legal position:
Communication Records:
- Written notice of the tenant’s termination request
- Your response outlining options and legal requirements
- Negotiation communications regarding settlement terms
- Final agreement documenting terms accepted by both parties
Property Condition Documentation:
- Move-out inspection with detailed photos and notes
- Damage assessment beyond normal wear and tear
- Cleaning requirements and cost estimates
- Repair needs affecting marketability
Financial Documentation:
- Marketing costs with receipts and vendor invoices
- Lost rent calculations based on actual vacancy period
- Re-rental expenses including tenant screening and lease preparation
- Settlement payments and deposit accounting
How IRES Handles Early Lease Termination
Professional property management transforms early termination requests from stressful negotiations into systematic business decisions:
Financial Analysis: Our experience with Las Vegas market conditions provides accurate cost projections for vacancy periods, re-rental expenses, and realistic recovery amounts.
Legal Compliance: We ensure all deposit retention decisions comply with Nevada law and proper documentation requirements, avoiding technical violations that could forfeit our retention rights.
Negotiation Expertise: Our professional relationship with tenants often facilitates cooperative early termination agreements that benefit both parties while protecting your financial interests.
Market Timing: We understand Las Vegas rental market cycles and can optimize re-rental timing to minimize vacancy costs and maximize rental rates for new leases.
Documentation Systems: Professional record-keeping that supports deposit retention decisions and provides legal protection if disputes arise.
Contractor Networks: Established relationships with cleaning services, repair contractors, and marketing vendors who can execute property preparation efficiently and cost-effectively.
Tenant Screening: Our systematic tenant screening process for replacement tenants ensures quick qualification and placement of quality tenants.
Most importantly, tenants respect professional property management communication and are more likely to cooperate with early termination procedures when dealing with established business systems rather than individual landlord negotiations.
The Bottom Line
You can keep security deposits for legitimate costs related to early lease termination, but Nevada law requires documentation of actual expenses and reasonable mitigation efforts. The security deposit alone rarely covers the full cost of tenant turnover, but it may be more than you’ll collect through lengthy lease enforcement procedures.
The key decision factors are tenant cooperation level, local market conditions, remaining lease term, and your risk tolerance for collection and legal proceedings.
Most successful property investors find that professional negotiation and systematic business practices produce better risk-adjusted returns than either automatic deposit forfeiture or aggressive lease enforcement, especially when dealing with cooperative tenants facing legitimate circumstances.
At IRES, we handle early lease termination requests as business decisions based on market data, legal requirements, and financial analysis rather than emotional reactions to lease violations. Our systematic approach protects your interests while maintaining professional relationships that often benefit both parties.
Ready to eliminate the guesswork from lease termination decisions? Contact IRES today for a free consultation on how professional property management can optimize your financial outcomes while ensuring legal compliance.
For complex situations involving disputed early termination or potential legal enforcement, we work with experienced Nevada attorneys who specialize in lease enforcement and security deposit law.