Landlord Atlas

What are the security deposit rules in Colorado?

Verified July 9, 2026 All Colorado topics →

Colorado caps security deposits at two months' rent — a rule in force since August 2023 — and layers on one of the country's most tenant-protective return regimes after a major 2025 rewrite took effect on January 1, 2026: deposits are due back within 30 days (a lease can stretch that to 60 at most), any retention needs a written statement of the exact reasons limited to four permitted causes, and tenants can demand the landlord's photos, receipts, invoices, and estimates within 14 days.

Normal wear and tear and anything that predated the tenancy can never be charged, full carpet or paint replacement requires substantial damage — with carpet over ten years old off the table entirely — and either side can insist on a move-out walk-through, in person or by video. The penalty structure has real teeth: any noncompliance forfeits the right to withhold at all, and wrongful retention (no longer just 'willful') triggers treble damages plus attorney fees after a 7-day demand, with the landlord bearing the burden of proof and a statutory presumption of bad faith when the amount kept reaches 125% of actual damages. Pet deposits are separately capped at $300 refundable with pet rent limited to the greater of $35 or 1.5% of rent, and no interest or escrow account is required.

Colorado security deposits at a glance

Maximum deposit 2 months' rent — C.R.S. 38-12-102.5 (SB23-184): on and after August 7, 2023, a landlord may not require a security deposit exceeding the amount of two monthly rent payments under the rental agreement. Separately, a PET deposit is capped at $300, must be refundable, and pet rent may not exceed the GREATER of $35/month or 1.5% of monthly rent (38-12-106, eff. 2024-01-01); the statute does not say whether the pet deposit counts inside the two-month cap. A seller-rent-back exemption takes effect 2026-11-01 (SB26-054, flagged).
Return deadline 30 days
Deadline conditions Within 30 days after termination of the lease or surrender and acceptance of the premises, whichever occurs last — 'one month' became 'thirty days' on 2026-01-01 (HB25-1249) — unless the lease specifies a longer period, which may not exceed 60 days (38-12-103(1)). Delivery of the statement, payment, and documentation to the tenant's last-known address, or to any email address the landlord has actual notice of, complies; refunds returned undelivered must be held at least a year and paid within 15 days of the tenant's request.
Itemization required Yes
Itemization rules A landlord retaining any portion must provide a written statement listing the EXACT reasons, with the balance paid alongside it. Since 2026-01-01, retention is allowed only for four causes — unpaid rent, unpaid utility charges, other unpaid lawful charges listed in the lease, and necessary repair work for damage or defective conditions exceeding normal wear and tear that did not preexist the tenancy — and supporting documentation (photos, inspection reports, receipts, invoices, estimates) in the landlord's possession or control must be provided within 14 days of the tenant's written request. Either party may demand a pre-termination walk-through inspection, in person or by interactive video. Normal wear and tear (now including ordinary-use damage and uncleanliness short of leaving the unit substantially less clean than at move-in) and preexisting conditions may never be charged; full carpet or paint replacement is chargeable only for substantial damage beyond wear and tear, and carpet more than 10 years old cannot be treated as substantially and irreparably damaged (38-12-103, as amended by HB25-1249).
Separate account required No
Interest owed to tenant No
Account & interest rules No interest or escrow/separate-account requirement exists for standard residential deposits (Title 38, Article 12, Part 1 checked; mobile home parks under Part 2 have their own rules).
Pet deposits C.R.S. 38-12-106 (HB23-1068, eff. 2024-01-01): an additional pet deposit may not exceed $300 and must be refundable; pet rent may not exceed the greater of $35/month or 1.5% of monthly rent. Assistance animals are not pets and may not be charged for under federal law.
Non-refundable fees allowed Not addressed by statute
Penalty for violation Layered scheme, tightened effective 2026-01-01 (HB25-1249): (1) failing to comply with the section or otherwise wrongfully withholding forfeits ALL rights to withhold any portion (38-12-103(2)); (2) WRONGFUL retention — the old 'willful' standard is gone — makes the landlord liable for treble the portion wrongfully withheld plus attorney fees and costs, provided the tenant gave a written demand and 7 days' pre-suit notice and the landlord failed to return the disputed amount within those 7 days (38-12-103(3)); (3) the landlord bears the burden of proving the withholding was not wrongful AND that the section was complied with; (4) retention is presumed unreasonable (bad faith) if the amount retained is 125% or more of actual damages (38-12-103(3.5)).
Tenant forwarding-address duty None — the landlord's delivery duty runs to the tenant's last-known address or any email address the landlord has actual notice of, and undeliverable refunds are held for the tenant for at least a year (38-12-103, as amended).

Notes and caveats

Two stale-source traps documented: (1) pre-2023 sources say Colorado has no deposit cap — wrong since SB23-184 (2023-08-07); (2) several 2025-2026 blogs claim HB25-1249 cut the cap to one month with mandatory installment plans — FALSE; those provisions were in the introduced bill and stripped by amendment (verified against the official enrolled act, which touches only 38-12-102 definitions and 38-12-103). The public.law mirror's 38-12-103 page still showed the pre-2026 'one month' return text when checked — the enrolled act controls. Citation caveat (GA-class): official CRS has no stable deep links, so official sourcing rides on leg.colorado.gov bill records and the enrolled-act PDF, with the mirror cited official:false. The wrongful-vs-willful standard change and the 125% presumption are the page-copy headlines. HB25-1168 (2025) separately limits deductions for damage arising from domestic violence/sexual assault (38-12-402 cross-references). On sale of the property, deposits must now transfer within 60 days (was 'a reasonable time'). nonrefundable_fees_allowed is null: no statute squarely authorizes or bans general nonrefundable move-in fees, and the 2026 junk-fee disclosure law (HB25-1090) regulates disclosure, not refundability.

Statute citations

How this record was verified: Colorado's official CRS text is published via LexisNexis without stable deep links (GA-class sourcing situation), so verification pairs official session-law sources with current code mirrors: the HB25-1249 enrolled act read verbatim from the official leg.colorado.gov PDF (full text extracted) and re-confirmed against the official bill-page summary (independent reads matched on the 30-day return deadline, wrongful-retention standard, 125% presumption, walk-through, and carpet/paint rules, and confirmed NO deposit-cap change); official bill pages read for SB23-184 (deposit cap), SB21-173 (late fees), HB21-1121 (rent-increase notice/frequency), HB23-1068 (pet deposits), HB23-1115 (rent-control repeal — died), HB25-1092 and HB26-1047 (died), and SB26-054 (PCOA exemption, eff. 2026-11-01). Statute text quoted from the colorado.public.law and FindLaw mirrors (official: false), with §§ 38-12-105 and 38-12-701 each read on the mirror twice via independent fetches that matched. Checked 2026-07-09.