The Illinois sublease agreement is a legal contract that allows a tenant to rent out all or a portion of the property to a subtenant in exchange for regular payments.
Does a Tenant Need the Landlord’s Permission to Sublet in Illinois?
A tenant in Illinois does need to receive a landlord’s explicit written permission to sublet. Even after consent is given, a landlord still has the right to reject a subtenant if they are unqualified, such as for having bankruptcy or poor references.
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Standardized Illinois Sublease Agreements
A standard form can be used in Illinois to create a sublease. Here’s what is generally included in an Illinois sublease agreement:
- The Names of the Parties – The original tenant under the lease is named in the sublease and is called the “Sublessor.” The third party that is subleasing the rental unit is named in the sublease and is called the “Sublessee.”
- Rent – How much the rent is, when it needs to be paid, and how to pay it.
- Term – The exact date of the sublease beginning and ending date.
- Rental Unit Location – The address for the rental unit as described in the master lease.
- Liability – The sublessee will be liable for any damages to the Sublessor. The Sublessor has the ultimate responsibility to pay for any damages that impact the landlord as stated in the master lease agreement.
- Authorized Occupants – This identifies the new tenant(s) and those authorized to live in the rental unit including any policy about short-term guests.
- Security Deposit – This security deposit is held by the Sublessor (not the landlord). There is no limit on the maximum security deposit by Illinois state law, except in mobile home parks, where the security deposit is limited to one month’s rent.
- Return of Security Deposit – Illinois landlords must return security deposits within 45 days from the date the tenant vacates the unit if there are no deductions or within 30 days if the landlord intends to make deductions.
- Inventory of Included Items – The list of items in the rental unit that are part of the sublease which may include furniture or appliances.
- Lead-Based Paint Notice – Under Federal law, if the rental unit’s premises were built before 1978, the Sublessee must be given a written warning notice, called a Lead-Based Paint Disclosure.
- Master Lease Inclusion – A copy of the Master Lease is attached to the sublease. If any exceptions in the Master Lease are not included they should be clearly stated in this section.
- Disputes – A description of how disputes between the Sublessor and Sublessee are to be settled, which may include mediation and binding arbitration to avoid more expensive legal proceedings.
- General Conditions – A statement that the written sublease agreement contains all of the agreements between the parties and can only be modified by written consent of the parties to the agreement.
- Utilities – The utilities to be paid by the Sublessor and those that are to be paid by the Sublessee.
- Smoking Policy – If smoking is restricted in the rental unit and any designated smoking areas are identified in the sublease.
- Landlord’s Consent – This section describes how the landlord is asked to give consent (if consent is not already included in the Master Lease). Tenants may create a signed sublease that is conditional on being accepted by the landlord before the sublease becomes effective.
- Signature: The signature and date for the Sublessor, the Sublessee, any Co-Sublessors, and Co-Sublessees (if they exist).
Tax Implications of a Sublease
In Illinois, a sublessor may be subject to the 6% state hotel tax and additional city or county taxes if they sublet for less than 30 days. For example, in Chicago, the hotel operators’ tax includes:
- State tax – 6.17%
- City (Municipal) – 1.08%
- ISFA (Illinois Sports Facilities Authority) – 2.14%
- Cook County – 1%
- MPEA (Metropolitan Pier and Exposition Authority) – 2.5%
- City (Home Rule) – 4.5
Total – 17.39%
