If you are a master tenant in San Francisco, you occupy two legal roles at once: you are a tenant to the property owner and a landlord to anyone subletting a room from you. That dual status gives you specific rights under the San Francisco Rent Ordinance and the Rent Board’s Rules and Regulations, and it saddles you with obligations that go well past what a typical lease spells out. The rules below cover the areas master tenants most often get wrong: replacing roommates, splitting rent, evicting a subtenant, handling what happens when you yourself move out, returning security deposits, and reporting rent you collect on your taxes.
Bringing in a New Roommate
When a roommate moves out, you have the right to bring in a replacement. For most San Francisco leases, which require landlord consent before a new occupant moves in, Section 6.15B of the Rent Board’s Rules and Regulations controls the process.1SF.gov. Rent Board Rules and Regulations – Part VI – Rent Increase Justifications
You must ask the landlord in writing before the proposed subtenant moves in. The applicant should complete the landlord’s standard rental application, or, if there isn’t one, provide enough information for a normal credit and background check. The landlord then has five business days to respond. If they don’t, you can file a decrease-in-services petition with the Rent Board.
The landlord can only refuse on reasonable grounds. If your proposed roommate meets the same credit, income, and background standards the landlord applies to other tenants in the building, withholding consent is unreasonable under the regulations. The applicant also has to agree to be bound by the existing rental agreement. A landlord who unreasonably refuses consent cannot then turn around and use the unauthorized subletting as grounds to evict you.
How Much You Can Charge Each Roommate
You cannot profit from subletting. Rent Board Rules and Regulations Section 6.15C requires each subtenant to pay only their proportional share of the total rent you owe the landlord, and the combined rent from all subtenants cannot exceed what you pay the owner.1SF.gov. Rent Board Rules and Regulations – Part VI – Rent Increase Justifications
Proportional does not have to mean equal. The calculation can account for room size, whether a room has a private bathroom, access to common areas, and amenities like parking. In a three-bedroom unit renting for $4,500, the person in a small room without a private bathroom should pay less than the person in a large bedroom with an en suite. You should also disclose, in writing, the total rent you pay to the landlord before the subtenancy begins. Skipping that disclosure weakens your position if a dispute lands at the Rent Board.
A subtenant who suspects overcharging can file a petition alleging an unlawful rent increase. If the Board agrees, it can order you to refund every dollar of overpayment going back to when the overcharge started. Over a multi-year tenancy, those refunds can run into thousands. Keep records of what you pay the landlord and how you calculated each roommate’s share.
Evicting a Subtenant
San Francisco’s just cause eviction protections apply to most subtenants who have lived in the unit for at least 30 days. Under Section 37.9 of the Administrative Code, you cannot recover possession without a legally recognized reason such as nonpayment of rent, habitual late payment, nuisance behavior, illegal use of the unit, or refusal to provide reasonable access.2American Legal Publishing. San Francisco Administrative Code 37.9 – Evictions
The process looks like what a property owner would follow: a formal notice such as a three-day notice to pay rent or quit, or a notice to cure a lease violation, served correctly and within the right timeline. Most master tenant evictions fall apart on paperwork. Judges read the notices closely, and a subtenant’s attorney will hunt for any procedural defect.
The In-Unit Landlord Exception
Section 37.9(b) lets a landlord who lives in the same unit as the tenant evict without just cause, and a master tenant qualifies as that in-unit landlord. There is a catch for any subtenant who moved in after April 25, 1998: the exception only works if you gave the subtenant written notice before the subtenancy began that just cause protections were being waived. No written waiver, no exception. You then need a recognized legal reason to evict, the same as any other landlord.
This is one of the highest-stakes paperwork failures in San Francisco tenant law. If you skipped that disclosure at move-in, you may be stuck with a difficult roommate indefinitely unless they actually violate the lease. The waiver should be clear, signed, and kept on file permanently.
Relocation Payments for No-Fault Evictions
If you evict a subtenant for a no-fault reason, Section 37.9C may require you to pay relocation. The base amount set in the code is $4,500 per eligible tenant, half when the notice is served and half when the tenant moves out. Tenants who are 60 or older, disabled, or in a household with children under 18 are entitled to an additional $3,000. A single unit is capped at $13,500 in total base payments.3American Legal Publishing. San Francisco Administrative Code 37.9C – Tenants Rights to Relocation for No-Fault Evictions
Those base figures adjust every March 1 to the rent component of the local Consumer Price Index. For the March 2024 through February 2025 period, the per-tenant payment was approximately $7,912, the additional vulnerable-tenant payment was roughly $5,275, and the per-unit cap was approximately $23,733. Missing a payment or a procedural step can invalidate the whole eviction.
What Happens When You Move Out
This is where subtenants often get blindsided, and where you need to understand your own exit before you take it. Under California’s Costa-Hawkins Rental Housing Act, when the last original occupant permanently leaves a rent-controlled unit, the landlord can raise the rent to market rate for any remaining subtenant who moved in on or after January 1, 1996.4SF.gov. Rent Increases Under Section 6.14 and Costa-Hawkins A roommate paying $1,200 for a room could suddenly face a demand reflecting today’s market, even if the landlord approved them.
Section 6.14 of the Rent Board Rules adds a wrinkle. The landlord can serve a written 6.14 notice on any new subtenant, warning that the rent can be raised without limit once the last original tenant vacates. The landlord must serve that notice within a reasonable time after learning of the subtenant’s occupancy, generally within 60 days. After the market-rate reset, future annual increases return to the Rent Board’s allowable percentage.
Two groups of subtenants are protected from this spike. Anyone who moved into the unit before January 1, 1996, is not subject to Costa-Hawkins vacancy decontrol. And a co-tenant, meaning someone with a direct agreement with the landlord or who has effectively become a direct tenant through the landlord’s acceptance of rent, is exempt regardless of when they moved in. The distinction between subtenant and co-tenant matters enormously, so if your roommates are worried about a future increase, think about whether any of them have established a direct relationship with the landlord.
Security Deposits You Collect
When you collect a deposit from a subtenant, you are bound by California Civil Code Section 1950.5, the same law that governs landlords. Since AB 12 took effect on July 1, 2024, the maximum security deposit for most rentals is one month’s rent, furnished or unfurnished.5California Legislative Information. California Civil Code 1950.5 The old limits of two months for unfurnished and three months for furnished units no longer apply.
A narrow exception lets a natural person, or an LLC whose members are all natural people, charge up to two months’ rent if they own no more than two residential rental properties totaling four or fewer units. The exception does not apply if the prospective subtenant is an active-duty service member. In most San Francisco roommate situations, the one-month cap is the one you’ll be working under.
Once a subtenant moves out, you have 21 calendar days to return the deposit with an itemized statement explaining any deductions. Deductions are only allowed for unpaid rent, cleaning beyond normal, and repairing damage past ordinary wear and tear. The statement must describe the work; if you did the repairs yourself, include the time spent and your hourly rate, and if someone else did them, attach copies of invoices and receipts.
Miss the 21 days and you open the door to small claims. If a court finds you withheld the deposit in bad faith, your former roommate can recover up to twice the deposit amount on top of the actual funds. Photograph each room at move-in and move-out; those photos are the single most reliable way to justify a deduction later.
Reporting the Rent You Collect
Rent you receive from subtenants is taxable income. The IRS treats payments for the use of your living space as rental income, reported on Schedule E of Form 1040.6Internal Revenue Service. Rental Income and Expenses You report the gross amount collected and then deduct allowable expenses against it, which is true even if you’re not making a profit.
Deductible expenses can include the proportional share of rent you pay the landlord for the sublet space, renter’s insurance, and utilities you cover for the subtenant’s portion of the unit. A deposit you collect and later return is not income. If you keep part of a deposit for unpaid rent or damage, that amount becomes taxable in the year you keep it. Advance rent, meaning any payment covering a future period, is taxable when you receive it, not when the rental period arrives. Many master tenants don’t learn about these reporting obligations until a tax preparer flags the gap, and catching up on several years of unreported sublet income is far more painful than reporting it correctly from the start.