Property Management

A Pennsylvania property manager collects first month's rent, last month's rent, and a security deposit from a new tenant. How must these funds be handled?

AAll funds may be deposited in the property manager's general operating account
BThe security deposit must be held in a separate escrow account; the rent payments may be deposited in the operating account or owner's account✓ Correct
CAll three amounts must be held in separate accounts at different financial institutions
DThe security deposit and last month's rent must both be held in escrow; first month's rent may be deposited in the operating account

Explanation

Under Pennsylvania law, security deposits must be held in escrow (separate from operating funds) if $100 or more. Rent payments (first month, last month) are income and may be deposited in the property's operating account or forwarded to the owner per the management agreement.

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