What can I counterclaim for in a California small claims case, and how much?

A counterclaim can cover anything arising from the same transaction or a closely related one, not just a direct rebuttal of the plaintiff's specific allegations. As an individual, your counterclaim can go up to $12,500, the standard small claims limit.

Importantly, your counterclaim amount doesn't have to stay under whatever the plaintiff is suing you for. A commonly cited example is a tenant sued for $4,000 in alleged damages who is actually owed $9,200 in a wrongfully withheld deposit and related statutory penalties, filing that counterclaim can completely flip which side comes out ahead in the case.