Note: Due to a Colorado Supreme Court ruling that found last month’s rent to be pre-paid rent, interest is not due on last month’s rent held by the landlord. All other refundable deposits including pet deposits should be included in the computation.

Example computations:
A. $1,000 deposit on a two-year lease starting on Aug. 1, 2002, and ending July 31, 2004. Landlord received the deposit at lease signing on May 1, 2002, and is mailing it back on Sept. 27, 2004. $1,000 x .055 = $55 (this equals one year’s interest) divided by 12 = $4.58 (one month’s interest) x 29 (number of month’s held by landlord) =$132.82.

B. $800 deposit on a 13.5 month lease which rolled over into a month-to-month tenancy after the initial year written lease. Tenant moved in and paid the deposit on May 15, 2003 and moved out with proper notice on Sept. 30, 2004. Landlord is returning the deposit on Oct. 31, 2004. $800 x .055 = $44 divided by 12 = $3.67 (one month’s interest rate until May 15, 2004) x 12=$44.04 (or $44 even) plus $800 x .0108=$8.64 divided by 12 =$ .72 x 5.5 months =$3.96. Total interest due is $3.96 + $44 = $47.96.