Rental property returns and income tax calculator

Use our free rental property calculator to estimate your returns and cash flow.

Price, rent & expenses

Purchase price
Monthly rent
Taxes
%
Annual insurance
Vacancy
days
Leasing fee
months
Property Mgmt fee
%
Maintenance cost
%

Financing details & taxes

Financing
%
Interest Rate
%
Amortization
years
Effective Tax Rate
%
Land Value
%

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Annual Profit & Loss $411

Annual Rent $1,200
Vacancy $99
Net Rent $1,101
Taxes $375
Annual Insurance$100
Repairs & Maintenance $88
Property Management $77
Leasing Fees $50
Total Expenses $690
Net Operating Income (NOI) $411
Cap Rate 1.64%

Financed Return (ROI) -4.31%

After Tax Returns 0.83%

How is rental income taxed?

Rental income is taxed as ordinary income. This means that if an investor is in a 22% marginal tax bracket and their rental income is $5,000, the investor would end up paying $1,100.

Here's the math we used to calculate that tax payment: $5,000 x .22 = $1,100.

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  • How is a rental property defined?

    "Any payment you receive for the use or occupation of property" is how the IRS defines rental income.

    Here are additional types of rental income:

    • Advanced rent payments: If your tenant pays both the first and last month's rent before moving in, then you would count both payments as income for the year in which they're received.

    • Portions of the security deposit that you keep: The security deposit isn't counted as rental income if it's returned in full to the tenant. If, however, you keep a portion of the deposit for any reason, like to repaint the room, then that amount counts as rental income.

    • Expenses your tenants pay for if they're not required to do so: If your tenant pays their electricity bill and subtracts it from their monthly rent, then the sum used to cover the bill counts as rental income.

    • Services rendered in place of rent payments: If your tenant provides you with services in place of rental payment, like charging you $50 for piano lessons, then that $50 counts as rental income.

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