Ruined carpet and security deposit question

[Nick Macklin]

I'm sure someone has run into this issue so I figured I'd reach out but first a little back story.  Tenants signed a 1 year lease in July.  Paid rent on time if not early every month.  A few months ago they asked if they could replace the carpet in a few rooms at their expense.  Didn't know if they were staying for a while and I said I would be ok if they did everything so it all matched, but I never heard anything more until they said they were hoping they could get out of the lease early.  I took it as a chance to get more rent and placed it on the market and had it rented in 1 day (should have asked for more rent in hind sight).  They then started asking for their security deposit early because they needed it for the new place.  Of course I explained why that could not happen.  

While showing the place I noticed some coloring on the walls and what I thought were marker stains on the carpet.  They fixed the walls but the carpets are pretty bad after only 6 months.  I found out many of the stains are kool aid and probably won't come out.....  They are in every room.  I had not planned on replacing the carpets for quite a few years but now I will have to if a cleaner can't get them out.

My question is:  How much of the deposit can I legally count towards replacing the carpets now if the stains don't come out?  Also, on a side note, they smoked in the garage even though the lease states "no smoking on the premises" and when I showed the house it smelled like cigarette smoke in there.  Thanks for the help!