Colorado Security Deposit Collections and Holdings

Colorado Security Deposit Collections and Holdings

Last Updated: April 16, 2024 by Roberto Valenzuela

Quick Facts Answer
Maximum / Limit Mobile homes: 1 month’s rent
Other housing: 2 months’ rent (starting August 2023)
Receipt Requirement Yes
Inventory Requirement None
Interest Requirement None

To learn about laws on security deposit returns in Colorado, click here.

Maximum Security Deposit Allowed in Colorado

The maximum security deposit on a rental unit is two months’ rent in Colorado, except in mobile home parks, where the security deposit is limited to one month’s rent.
home will continue to be one month’s rent.

Can Landlords Charge an Additional Pet Deposit in Colorado?

Yes, landlords can collect an additional pet deposit in Colorado, except for service dogs and emotional support animals. The maximum allowed amount for a pet deposit is $300.

If a landlord collects a pet deposit in Colorado, it must be handled according to the same rules as a security deposit.

note

In addition to a $300 pet deposit, a landlord can also charge pet rent up to $35/month or 1.5% of the monthly rent (whichever is greater).

How Much Rent Can a Landlord Collect Upfront in Colorado?

There is no limit on the amount of rent that can be collected upfront in Colorado. Many states have a limit on the amount of rent that can be collected at once, but Colorado does not.

However, starting August 7. 2023. due to recently approved legislation, landlords can only collect the first month’s rent plus two additional months’ rent whether called a “security deposit” or “last month’s rent.”

Security Deposit Collections in Colorado

While other states have additional requirements for landlords that collect a security deposit, such as providing certain documentation of the condition of the unit at move-in, Colorado does not.

Do Landlords Have to Provide a Receipt for the Security Deposit in Colorado?

In Colorado, landlords are required to provide a receipt for the security deposit for payments made in person by cash or money order.

If the tenant pays by cash or money order but does not pay in person, the landlord is only required to provide a receipt upon request. If requested, the receipt must be provided within 7 days.

Receipts can be provided electronically, but landlords must provide a paper copy if requested by the tenant.

What Obligations Do Landlords Have to Establish the Condition at Move-in in Colorado?

Colorado law does not require landlords to document or establish the property’s condition at move-in. While other states legally require a written inventory of damages to be completed when collecting a security deposit, Colorado does not.

Security Deposit Holdings in Colorado

Colorado law does not require landlords to hold security deposits separate from other funds except for mobile homes.

Landlords of mobile home spaces in Colorado must place each security deposit into a separate trust account. The security deposit cannot be commingled with any other funds.

Are Tenants Entitled to Interest on Their Security Deposit in Colorado?

Colorado law does not require landlords to provide interest on held security deposits, but local governments may enact their own rules regarding security deposit interest, like in Boulder.

Tenants in Boulder are entitled to interest on their security deposits, except for mobile homes. The minimum interest rate is based on the average of one-year certificates of deposit.

How Are Security Deposits Accounted for in Colorado?

Security deposits are not considered taxable income when they are collected.

What Happens to a Security Deposit When the Property is Sold in Colorado?

When a property is sold in Colorado, the seller must  either:

  • Transfer the security deposit to the new owner and notify the tenant in writing of the new owner’s name and address; or
  • Return the security deposit to the tenant

In either case, the original landlord can make any allowed deductions first.

Sources

Security Deposit Collections in Other States