Colorado Security Deposit Law: Avoid Unfair Deductions

Colorado Security Deposit Law: What Changed on January 1, 2026.

Colorado’s security deposit law is a common source of frustration for renters, especially when landlords deduct money for what seems like normal wear and tear.

As of January 1, 2026, Colorado’s HB 25-1249, the Tenant Security Deposit Protections Act, strengthens tenant protections with clearer rules for deposit deductions, move-out inspections, and penalties for wrongful withholding.

Here’s what renters need to know about Colorado security deposit law in 2026.

What changed under the Colorado security deposit law?

HB 25-1249 updates Colorado’s existing security deposit laws (C.R.S. § 38-12-101 and following) to help protect tenants from unfair deductions. For the official breakdown, see the Colorado Division of Real Estate summary of HB 25-1249.

The biggest changes include:

• Clearer definitions of normal wear and tear.
• Stricter limits on carpet replacement and painting charges.
• New protections for move-out inspections.
• Stronger standards for wrongful withholding and bad faith.
• Additional requirements for documenting security deposit deductions.

These changes to Colorado security deposit law generally apply to landlord conduct occurring on or after January 1, 2026.

How much can a landlord charge for a security deposit in Colorado?

Colorado landlords can generally charge a security deposit of up to two months’ rent. For example, if your monthly rent is $2,000, your maximum security deposit is $4,000.

This limit has been in place since 2023 and was not changed by HB 25-1249. Landlords may also charge a separate refundable pet deposit of up to $300, subject to applicable law.

Beginning January 1, 2027, a limited exception will allow higher deposits for certain post-closing occupancy agreements, when a home seller temporarily remains in the property after closing. Standard residential leases are not affected by this exception.

What counts as normal wear and tear under Colorado security deposit law?

Under HB 25-1249, normal wear and tear includes deterioration from ordinary, intended, or reasonably expected use of a rental property, without negligence, carelessness, accidents, or abuse.

Landlords cannot deduct from a security deposit simply because a property shows signs of everyday living.

The law provides specific protections:

• Cleaning: Ordinary uncleanliness generally isn’t grounds for a deduction. Cleaning charges must be justified by the property’s condition.
• Carpet: Landlords generally cannot charge for replacement unless damage is substantial and irreparable. Carpet that hasn’t been replaced within 10 years receives additional protection.
• Paint: Minor scuffs and fading are normal wear and tear. Charges for substantial damage must be limited to the affected areas.
• Pre-existing damage: Landlords cannot charge tenants for damage that existed before they moved in.

These rules help distinguish legitimate property damage from the normal costs of maintaining a rental.

Can Colorado tenants request a move-out inspection?

Yes. Under HB 25-1249, tenants can request a walk-through inspection before moving out.

When reasonable and practicable, the landlord and tenant must conduct the inspection in person or through an interactive video call. The inspection should identify and document damage beyond normal wear and tear.

Tenants should also take photographs, keep their move-in inspection records, and save written communications to help prevent disputes.

How long does a landlord have to return a deposit under Colorado security deposit law?

Colorado landlords generally have 30 days after the lease ends or the tenant surrenders the property, whichever is later, to return the security deposit.

A lease can extend this deadline to a maximum of 60 days.

If the landlord makes deductions, they must provide a written statement explaining the reasons and return any remaining balance within the required timeframe.

Tenants can also request supporting documentation, such as photographs, inspection reports, receipts, or invoices. HB 25-1249 establishes additional documentation requirements in certain circumstances.

What happens if a Colorado landlord wrongfully withholds a deposit?

Colorado security deposit law allows tenants to challenge security deposits that are improperly withheld.

Under HB 25-1249, withholding 125% or more of the actual damages is presumed unreasonable. For example, keeping $600 for $400 in legitimate damages exceeds that threshold.

A landlord may also act in bad faith by withholding money without a valid reason or for retaliatory or discriminatory purposes.

Tenants may qualify for treble damages, or three times the amount wrongfully withheld, when the legal requirements are met. Generally, tenants must first provide written notice of their intention to sue and allow at least seven days for the landlord to return the disputed amount.

Does HB 25-1249 apply to older leases?

Yes, potentially. Colorado security deposit law generally applies to conduct occurring on or after January 1, 2026, even if the lease was signed earlier.

For example, a tenant who signed a lease in 2025 but moves out in 2026 may benefit from the updated protections. The specific circumstances and timing of the landlord’s actions determine which provisions apply.

What should tenants do if their security deposit is withheld?

If your landlord refuses to return your deposit or makes questionable deductions, document everything.

Keep your lease, photographs, inspection reports, payment records, and written communications. Request an itemized explanation of deductions and any available supporting documentation.

Colorado security deposit law includes specific deadlines and notice requirements that can affect your ability to recover wrongfully withheld money.

Flaxman Law Group helps Colorado tenants navigate security deposit disputes, including improper deductions, delayed returns, and potential bad-faith withholding.

If you’re dealing with a landlord who won’t return your deposit, contact Flaxman Law Group to speak directly with an attorney about your rights and legal options.