Contractor deposit limits by state
Some states limit how much a home improvement contractor can collect before work starts, such as $1,000 or 10% in California. Most states set no general cap. This table lists each state with a statutory limit.
This is general information, not legal advice. Laws change, and your contract terms matter. Check with a lawyer in your state. Laws change and can apply differently to your situation, so check your state's current law or ask a lawyer before you charge a late fee, interest or a deposit. Last reviewed October 20, 2026.
States with a deposit limit
| State | Limit | Statute |
|---|---|---|
| California | $1,000 or 10% of the contract price, whichever is less, for a home improvement or swimming pool contract. | Cal. Bus. & Prof. Code §§ 7159, 7159.5 |
| Nevada | $1,000 or 10% of the contract price, whichever is less, for work on an owner-occupied single-family home (residential improvements), residential pools and spas, and residential solar systems. | NRS 624.970(2)(g) (residential improvements); NRS 624.940(2)(g) and 624.935 (pools and spas); NRS 624.870 (residential solar) |
| Maryland | One third of the home improvement contract price, before or when the contract is signed. No payment of any kind may be taken before the contract is signed. | Md. Code, Bus. Reg. § 8-617 |
| Massachusetts | One third of the total contract price, or the actual cost of special order or custom made materials or equipment that must be ordered before work starts, whichever is greater. | Mass. Gen. Laws ch. 142A, § 2(a)(6) |
| Pennsylvania | One third of the contract price, or one third of the price plus the cost of special order materials named in the written contract, for home improvement contracts over $5,000. | Home Improvement Consumer Protection Act, Act 132 of 2008, § 9(10), 73 P.S. § 517.9(10) |
| Maine | One third of the total contract price as the initial down payment, for home construction contracts over $3,000. | 10 M.R.S. § 1487(5); definitions in § 1486 |
| Ohio | 10% of the contract price before work starts, for home construction service contracts over $25,000. Up to 75% of the cost of a special order item that can't be returned or used elsewhere is allowed. | Ohio Rev. Code §§ 4722.01, 4722.04 |
| Florida | No hard cap. A contractor who takes more than 10% of the contract price as an initial payment on residential work must apply for permits within 30 days and start work within 90 days after permits issue. | Fla. Stat. § 489.126(2) |
No general cap found: Connecticut, Minnesota, New York, Wisconsin. Connecticut: no deposit cap found in the Home Improvement Act, Conn. Gen. Stat. ch. 400 (https://www.cga.ct.gov/current/pub/chap_400.htm). Contractors need a home improvement certificate.Minnesota: no deposit cap in the written contract statute for residential contractors, Minn. Stat. § 326B.809 (https://www.revisor.mn.gov/statutes/cite/326B.809).New York: no percentage or dollar cap in the home improvement contract statute, N.Y. Gen. Bus. Law § 771 (https://www.nysenate.gov/legislation/laws/GBS/771). Payments received before the work is done must be deposited as required by Lien Law § 71-a(4), or the contractor may post a bond, contract of indemnity or bank guarantee instead. Progress payments must bear a reasonable relationship to the work.Wisconsin: no deposit cap in the home improvement trade practices rule, Wis. Admin. Code ch. ATCP 110 (https://docs.legis.wisconsin.gov/code/admin_code/atcp/090/110). It bans misrepresenting the down payment.These four were checked against their main home improvement law only. Other statutes or local rules could still apply. All other states were not researched for this file.
Exceptions to check
- Special order materials: Massachusetts allows the actual cost of special order or custom materials if it is more than one third. Pennsylvania allows one third plus special order materials named in the contract. Ohio allows up to 75% of a nonreturnable special order item. California has no special order exception.
- Bonds: California exempts the few licensees with a blanket performance and payment bond on file. Nevada's residential improvement limit does not apply to a contractor with a $100,000 consumer protection bond on file. Pennsylvania exempts home improvement retailers that post a bank guarantee.
- Contract size: the caps start above certain amounts in some states. Pennsylvania over $5,000, Maine over $3,000, Ohio over $25,000, and Massachusetts over $1,000.
- Cost-plus contracts: Ohio's 10% limit does not apply to cost-plus contracts.
- Residential work only: every rule listed here covers homes, not commercial buildings.
- License or registration: these rules sit inside contractor licensing or registration laws. Massachusetts contracts must say contractors must be registered. Connecticut requires a home improvement certificate. Florida's rule applies whether or not the contractor is licensed.
- Not confirmed: District of Columbia home improvement rules (16 DCMR ch. 8) were not readable on dcregs.dc.gov, so DC is not listed. Check them directly.
Keep going
This is general information, not legal advice. Laws change, and your contract terms matter. Check with a lawyer in your state. Laws change and can apply differently to your situation, so check your state's current law or ask a lawyer before you charge a late fee, interest or a deposit. Last reviewed October 20, 2026.