Taxi Lease Security Deposits: Limits, Interest & Refunds

In short: A taxi owner or fleet may ask for a security deposit, but no more than one lease term: one shift's price for a shift lease, one week's price for a weekly lease, and never more than one week's price even for a longer lease. DOV leases (medallion plus a car you are buying) are the exception: up to $5,000. The owner must give you a written receipt, keep the money in an interest-bearing account in New York City, pay you the interest (minus one percentage point), and return the deposit within 30 days after the lease ends, with a written list of anything kept. Only five kinds of costs can come out of it.

The rule is TLC Rule 58-21(e), checked October 12, 2026. If your lease is governed by a collective bargaining agreement that covers deposits, these limits don't apply (Rule 58-21(e)(8)). This is general information, not legal advice.

How much the deposit can be

Rule 58-21(e)(4) gives its own examples:

The rule's examples use round numbers; today a day shift is capped at $105, so a shift deposit could not be more than the shift price you actually pay. Lease caps are in NYC taxi lease caps.

DOV deposits work differently. The weekly lease payment must be credited by the pro-rated value of the deposit, so it is paid back to you over the lease. Until the lease ends, the owner may keep only an amount equal to the deposit allowed for a medallion-only lease. If the owner cancels the lease, any deposit not yet credited must be refunded within 30 days; that does not apply if you break the lease early (Rule 58-21(e)(4)(iv)). Charging a deposit above these limits is a $200 fine, and the hearing officer must order the excess repaid. TLC's Driver Pay FAQ notes the 2018 rules added this restitution requirement.

What can be taken out, and what can't

Using the deposit for an owner's summons carries fines of $250, then $350, then $500 and/or up to 30 days' medallion suspension, and the judge must order the owner to repay you what was taken (Rule 58-21(e)(3)).

Damage claims

Damage is the deduction drivers argue about most. The rule allows it only if the lease "clearly and prominently states" that you are responsible for damage. Read your lease for that clause before you sign. On a weekly lease of a medallion and car, the lease price already includes collision and physical damage coverage unless you signed a separate written agreement to pay for damage caused by your own negligence, and if the owner later gets paid for the damage by someone else (for example, the other driver's insurer), what you paid must be refunded to you (Rule 58-21(c)(1)(vi)). That question is covered in can a taxi owner charge me for repairs?

A worked example (fictional)

A driver on a weekly night lease at the $737 cap pays a $737 deposit. During the lease, the cab gets one parking ticket for $65, which the driver was shown and chose not to fight. The lease ends on a Sunday. The owner may keep the $65 and must return $672 plus interest (minus one percentage point of interest), with a written list showing the $65 ticket, no later than 30 days after that Sunday. If the owner also deducted $150 for an "inspection ticket" written to the medallion owner, that $150 would be a violation of Rule 58-21(e)(3), and a judge would have to order it repaid.

A deposit is not a cancellation charge

Some leases also include a cancellation charge. It is a different thing with its own limits: no more than one lease term (one week for longer leases), and allowed only if the lease says it applies when you are behind on lease payments at the time you cancel. Once paid, your duty to make lease payments ends immediately (Rule 58-21(i)(5)). Rule 58-21(e)(2) does not name cancellation charges among the five items that can be taken from a deposit; if an owner tries to keep your deposit as a cancellation fee, ask the Driver Protection Unit whether that is allowed in your case.

Receipts, the bank account and interest

• Receipt when you pay. The owner must give a written receipt for the deposit (Rule 58-21(e)(5)(i)).
• Itemized list when anything is kept. You must get a written itemization of every item withheld (Rule 58-21(e)(5)(ii)). Fine: $50.
• Separate account. The deposit must sit in an interest-bearing account at a bank or credit union in New York City, used only for security deposits and not mixed with the owner's money. The owner must tell you in writing the bank's name and address and the account number (Rule 58-21(e)(7)).
• Interest is yours. The interest "must accrue to the benefit of the Driver", but the owner may keep one percentage point of it for bookkeeping. Fine: $50.
• The lease must say it. Every lease must include the deposit information required by Rule 58-21(e), and the deposit amount must be listed in the itemized lease cost (Rule 58-21(i)(2), (i)(6)).

The 30-day return

An E-ZPass replenishment account is a separate pot of money with its own rule: up to $10 per 12-hour shift, $100 at most, and unused funds back within 30 days after your lease ends (Rule 58-27(d)(2)). See the E-ZPass replenishment account and garage won't return my E-ZPass deposit.

Before you leave the fleet

If the deposit doesn't come back

1. Ask the owner in writing (text or email) for the deposit and the itemization, and keep a copy.
2. If 30 days have passed, contact TLC's Driver Protection Unit at 718-391-5539 or driverprotection@tlc.nyc.gov. TLC says the unit investigates complaints including failure to provide required documents, and has helped drivers get back more than $3.2 million (Driver Protection Unit).
3. An owner must not retaliate against you for complaining (Rule 58-21(j): $1,000 plus restitution, $10,000 for a second offense within five years).

The short version of these steps is in my fleet won't return my security deposit. Definitions: taxi security deposit. Shorter shift options are in can I lease a taxi for less than 12 hours? Note that a lease deposit has nothing to do with government benefits; for those, see do drivers earn Social Security credits? More on the money hub.