Florida law requires that landlords exercise 1 of 3 options with regard to safe keeping of advanced rent and security deposits: hold them in a separate non-interest bearing account, hold them in a separate interest-bearing account, or post a surety bond (FS §83.49). Who wants to go through the trouble of posting a surety bond (or finding out what a surety bond actually is for that matter)? The simplest option is one of the first 2.
However, many landlords don’t go through the trouble of forming a separate account to hold these monies that belong to the tenant. The law also requires the landlord to notify the tenant in the lease where the money is being held, or in writing within 30 days of receipt. Many don’t. They should! Taking these simple steps will prevent a lot of headaches and scorn from the courts upon termination of the lease, should there be a dispute over these funds. Just remember, don’t mix in any of your own money with the tenant’s money. This is called co-mingling, and Florida law prohibits it. Also be sure to retain a copy of the notice given to tenants as to the whereabouts of their deposits for your records.