Colorado Tightens Security Deposit Rules; Seven States Cap Deposits in 2026
Colorado's new HB 25-1249 treats deposits as tenant property held in trust and requires documentation within 14 days. Recent changes in Colorado, Georgia, Maryland make clear rules now protect renters in more states.
New Colorado Law Redefines Deposit Protections
Colorado's new legislation, HB25-1249, introduces important updates to the state's security deposit laws that directly impact landlords, property managers, and tenants. Security deposits are now legally considered tenant property held in trust by landlords, a significant shift that strengthens renter protections. If a landlord withholds any portion of a security deposit, they must provide all documentation in their possession (including photographs, inspection forms or reports, receipts, invoices, or estimates) relevant to the retention within 14 days following a tenant's request.
National Trend: More States Cap Deposits
Recent changes: Georgia (2 month cap, July 2024), Maryland (1 month cap, October 2024), and Colorado (1 month cap, January 2026) all added new statutory caps. As of 2026, about 20 states still impose no statutory cap on residential security deposits, while the other 30+ cap deposits at 1–3 months rent.
States and cities are also updating rules on how deposits must be returned. AB 414 in California took effect at the start of 2026 and modernizes the mechanics of how landlords must return deposits to tenants — specifically addressing electronic payments, digital delivery of statements, and situations involving multiple tenants on a single lease.
What Foreign Renters Should Know
If you're moving to Colorado, Georgia, or Maryland in 2026, your deposit is legally more protected than in most other US states—landlords must now treat it as your property, not theirs. Security deposit return laws often require landlords to explain any deductions in writing and return the remaining balance within a specific timeframe. Before signing any lease, confirm your state's deposit cap and return deadline. Request that all damage documentation be provided in writing, and keep detailed move-in photos on your phone. Knowing these rules protects you from losing thousands when you move out.
Sources
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