Subdomain is treated same as domains. so the penalties implemented on subdomais are all those penalties which are applicable on domains. So to keep out of Google sub domain penalty you should take care of the various penalties applied on domains. The penalties which can arise due to unethical link building, unethical on page factors, duplicate content, redirects, bad neighborhood, anchor text. You have to take all in consideration to be not victimized in subdomain penalty. Follow the ethical way to promote your site and make your site free from subdomain penalty.

Subdomain acts and ranks in the same manner as domains do. So falling under subdomain penalty can cause rank and traffic loss. Some time delisting of subdomain from Google indexes happens. So if you really want your subdomain to rank higher on the search engines, subdomain can add up to your revenue and a great way of generating traffic.

So always take care of ethical optimization of the sub domains.