Prorated rent: how to calculate it

Prorated rent is rent for part of a month. Work out a daily rate, then multiply it by the number of days the tenant has the unit. The most common method divides the monthly rent by the number of days in that month: $1,250 rent, moving in on October 20, is $1,250 ÷ 31 × 12 days = $483.87.

Three ways to get the daily rate

All three are used. Whichever you pick, write it in the lease and use it every time, so tenants are treated the same. Some states set the method for certain cases, so check local rules if you're unsure.

Step by step

1. Count the days the tenant has the unit, including the move-in day: October 20 to 31 is 12 days.
2. Work out the daily rate with your chosen method.
3. Multiply and round to the cent.
4. Put the prorated amount and the method in the lease or move-in letter.

Move-in mid-month: two common ways to bill

• Prorate the first month and collect full rent from the next 1st. Simple and the most common.
• Collect a full month at move-in and prorate the second month. Useful when a tenant moves in late in the month, so you're not collecting a tiny amount and then a full month a few days later.

Move-out mid-month

Whether you prorate at move-out depends on the lease and state law. Many leases require a full month's notice and full rent through the end of the notice period. If you agree to prorate, count the days through the move-out date, record it, and settle it together with the security deposit return.

Record it in the ledger

Enter the prorated rent as its own charge with the dates in the description ("Rent 10/20–10/31, prorated"), then the payment against it. A clean tenant ledger settles any later dispute.

Questions