How to use the sublease profit calculator
Subletting looks profitable whenever the rent you collect is higher than the rent you pay, but the spread is only the starting point. Utilities you cover, broker fees, cleaning between tenants, vacant months and income tax all come out of it. This calculator runs those steps in order and shows what is actually left.
The months rented field is where vacancy is handled: if the unit sits empty for part of the year, the annual profit falls accordingly. Net deposit tied up is the deposit you gave the landlord minus the deposit your subtenant gave you, which is the cash actually locked into the arrangement.
Sublease profit is ordinary income under 26 U.S.C. 61, reported on Schedule E in most cases, with the rent and operating costs you pay deductible under 26 U.S.C. 162. Figures reflect the 2026 tax year and state or city income tax is not included.
The tax shown applies a flat marginal rate, so it is an estimate rather than a filing figure. Your actual liability depends on other income, deductions and self-employment tax if the activity is a business. Check your lease terms and speak with a tax professional before relying on the numbers.
Frequently Asked Questions
Almost always. Most residential and commercial leases either prohibit subletting or require written consent, and subletting without it can be grounds for eviction. Read the assignment and subletting clause before you advertise.
The rent you collect is gross income under 26 U.S.C. 61 and the rent and costs you pay are offset against it, so only the profit is taxed. It is normally reported on Schedule E, or Schedule C if you provide substantial services.
A refundable security deposit you hold for a subtenant is a liability, not income, until you keep part of it. That is why the calculator treats deposits only as cash tied up when measuring your return.