According to the law in most states, landlords are legally allowed to retain a pre-paid rent and/or security deposit if a tenant passes away and essentially “breaks” their lease. That having been said, in other states, a landlord is under a duty to return such amounts once they are able to "mitigate damages" by re-renting the leased premises to another tenant. To find out the law in your jurisdiction, you can contact a local landlord-tenant group and/or consult with an attorney who handles landlord-tenant cases.
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