I am in Colorado. My company issues tools for us that are required for us to do our work. We get an annual tool inventory done and have to sign at the bottom where it states that we are responsible for the tools and upon termination will return them and replace any that are missing. Every year they ask us to pay for any missing tools. If we do not pay it will count against us on our annual raise review. This year I refused to pay because I cannot afford the $600 they are asking (many of my tools were stolen which is why I owe so much). They are now threatening to deduct the cost of the tools from my next paycheck. Is it legal for them to deduct this or I am not liable for the cost until my employment with the company is terminated (as per the inventory I signed)?
Also are there any legal issues with them charging us twice for the tools? Once in cash and once in lowered wages due to a lower annual raise review score. I doubt it but I thought I'd ask.

In Colorado deductions by written agreement between the employer and employee may be for loans, pay advances, goods or services, and equipment or property. The agreement must be in writing, enforceable, and not in violation of law. Since you signa an agreement, you are obligated to pay back the monies. Have you tried to work out the how the amount is paid back? In monthly installments?

Does this hold true even if what I signed specifically states "upon termination with the company"? I'm basically wondering if I could hold off payment until my last paycheck. I have no problem paying them because I know I owe it, I just don't want to pay now. They are being rude about this so I'll try to talk to them about monthly payments but I'm doubtful. The best thing for me would be to wait until my "termination with the company".

Thats up to the company and you trying to work this out with them.

I meant to say thanks for your first response, so thanks for both of them.