Colorado Security Deposit Law: Limits, Deadlines, and Penalties
What Colorado landlords can charge, when deposits must be returned, and what it costs to get it wrong. Last reviewed 2026-08-12.
How much can a landlord charge in Colorado?
Since August 7, 2023 (SB23-184), Colorado caps security deposits at two months' rent under C.R.S. § 38-12-102.5. The cap applies to all residential landlords regardless of portfolio size. Pet deposits are separately capped at $300 by C.R.S. § 38-12-106.
Since January 1, 2024 (HB23-1068), pet security deposits are capped at $300 and must be refundable, and pet rent is capped at the greater of $35 per month or 1.5% of monthly rent; no deposit may be charged for service or assistance animals.
When must the deposit be returned?
The default deadline is 30 days after termination of the lease or surrender of the premises, whichever occurs last; a written lease may extend it, but never beyond 60 days. HB25-1249 replaced the old 'one month' language with a flat 30 days effective January 1, 2026.
The landlord must deliver a written statement listing the exact reasons for retaining any portion, together with the balance due, within the deadline. Failing to provide the statement on time forfeits the right to withhold any portion of the deposit.
What happens if a landlord misses the deadline?
Willful or bad-faith retention makes the landlord liable for treble the amount wrongfully withheld plus attorney fees and court costs (C.R.S. § 38-12-103(3)). The tenant must give the landlord seven days' notice of intent to sue before filing.
Interest and holding requirements
Colorado has no statewide interest requirement. Boulder is the notable local exception: its ordinance requires landlords to pay interest on deposits for rentals inside city limits.
No statutory requirement for standard rentals — Colorado does not require a separate account, escrow, or bond for residential security deposits (mobile home park lots are subject to separate rules).
Recent changes to the law
HB25-1249 (effective January 1, 2026) set the return deadline at a flat 30 days, defined bad-faith withholding, barred deductions for normal wear and tear and preexisting conditions, and clarified treble damages. Earlier, SB23-184 capped deposits at two months' rent (August 2023) and HB23-1068 capped pet deposits at $300 and limited pet rent (January 2024).
What Colorado landlords get wrong
Colorado's forfeiture rule is unforgiving: miss the 30-day (or lease-specified, up to 60-day) deadline for the itemized statement and you lose the right to keep any of the deposit, even for legitimate damage — you can still sue the tenant separately, but you must refund first. HB25-1249 (effective January 1, 2026) spells out what counts as bad faith and confirms you cannot withhold for normal wear and tear or for conditions that existed before the tenancy, so document move-in condition thoroughly. Remember the separate $300 refundable pet deposit cap and pet rent limits from HB23-1068. Tenants must send a seven-day demand notice before suing, which is your last window to pay and avoid treble damages.
The law itself
Frequently asked questions
How much can a landlord charge for a security deposit in Colorado?
No more than two months' rent, under C.R.S. § 38-12-102.5, which took effect August 7, 2023. This cap applies to every residential landlord in the state. A pet deposit is capped separately at $300, must be refundable, and pet rent cannot exceed the greater of $35 per month or 1.5% of your monthly rent.
How long does a Colorado landlord have to return a security deposit?
Thirty days after the lease ends or you surrender the unit, whichever is later. Your lease can extend that period, but never beyond 60 days. Within the deadline the landlord must send your refund plus a written statement listing the exact reasons for anything withheld. Missing the deadline forfeits the landlord's right to keep any of the deposit.
What is the penalty for not returning a security deposit in Colorado?
A landlord who wrongfully withholds a deposit in bad faith owes three times the amount wrongfully withheld, plus your attorney fees and court costs, under C.R.S. § 38-12-103. Before filing suit you must give the landlord seven days' written notice of your intent to sue, which gives them a final chance to pay.
Can a Colorado landlord deduct for normal wear and tear?
No. Colorado law has long barred deductions for normal wear and tear, and HB25-1249 (effective January 1, 2026) strengthened this by also prohibiting deductions for damage or defective conditions that existed before your tenancy began. Legitimate deductions include unpaid rent, unpaid utilities, abandonment costs, and repairs for damage you actually caused.
Keep reading
Deposit deadlines are easy to miss — until they cost you triple.
Vantric tracks your leases, deposits, and move-out dates in one place, built for landlords with 1–10 units.
Start Free TrialThis page is general information, not legal advice. Statutes change — verify against the official text linked above or consult a local attorney before acting.