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I'm an independent contractor who will be receiving my formal document request next week to apply for a re-rental.
It's my understanding that the amount of documentation required of self-employed applicants is considerably more than for employed W-2 applicants.
It's also my understanding that from the middle of the year onward, you need to make a projection based on a careful record of receipts, invoices, etc. from the previous several months, which you also need to provide.
My question concerns what additional paperwork if any, may or may not be expected of me to provide under the circumstances of being able to provide my tax returns for 2022, which documents my income up to a little over 2 months ago.
Will I still also need to prepare detailed records of invoices, receipts, etc., for the first 2 months of 2023? Or even farther back, for 2022, even though I'll provide my tax returns for then?
I'm asking so I can prepare these items in advance if needed.
You should be prepared to provide up to date proof, in addition to your 2022 taxes. The taxes don't reflect your monthly on going income, it's more a look back at the whole of last year. For example, if you made 120K in January 2022 then nothing else, or 10K per month, your taxes would basically reflect the same thing. They will want up to date proof of the recurring income you receive, self-employment or w2 job. It is the same thing as how they would require the 6 most recent paystubs from a regular employee and an employment verification letter from your job that is less than 120 days old. Similarly, they will likely want the type of relevant proof for ~ the last 6 months going back from the date you get the doc request. And then if the process drags on for a couple of months (common), they will likely ask you to update the proof and provide those additional months.
You should be prepared to provide up to date proof, in addition to your 2022 taxes. The taxes don't reflect your monthly on going income, it's more a look back at the whole of last year. For example, if you made 120K in January 2022 then nothing else, or 10K per month, your taxes would basically reflect the same thing. They will want up to date proof of the recurring income you receive, self-employment or w2 job. It is the same thing as how they would require the 6 most recent paystubs from a regular employee and an employment verification letter from your job that is less than 120 days old. Similarly, they will likely want the type of relevant proof for ~ the last 6 months going back from the date you get the doc request. And then if the process drags on for a couple of months (common), they will likely ask you to update the proof and provide those additional months.
Thank you, linamonroll, your knowledge and detailed advice are always really helpful.
So the fact that my tax returns are so recent is irrelavant then, I'll get busy working on the details for six months ago to the present.
During my application process I had to submit 3 years worth of taxes (to prove self employment) and all of my 1099's for the most recent tax year. I also had to submit a letter (which I got notarized) stating what I "projected" my income would be for the upcoming year. I think I also submitted a profit/loss statement.
The biggest thing they are looking for when it comes to self-employment is consistency in their calculations. For example - if the past 3 years you've made $20,000 from self employment and are now claiming to be making $50,000 this year ... they would probably require a lot more proof (payments/etc). If your projection is in line with recent years earnings on your taxes - they will require less.
The HPD Marketing Handbook https://www.nyc.gov/assets/hpd/downl...dbook-8-21.pdf outlines the entire admissions process and how they complete income calculations/etc. Page 48 and on addresses self employment specifically.
Thank you, linamonroll, your knowledge and detailed advice are always really helpful.
So the fact that my tax returns are so recent is irrelavant then, I'll get busy working on the details for six months ago to the present.
They're not irrelevant but just will only be one way they calculate and project your income. Past taxes and w2s/1099s will be one, recent paystubs/payment receipts+invoices, your bank deposits, any contracts you have, and your self and/or accountant projection etc. will be the others and they will compare all the findings to determine what they find our expected income to be.
Location: Read the Marketing Handbook, and Income a Guide.
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If you have not already done so. Contact your bank(s), tax preparer (include for any recent year) now, ask them for a contact name or procedures for requesting documents from them with quick turnaround. Say that deadlines are involved and you are eligible to gain a substantial benefit by qualifying with financial docs and such. Just a heads up saying there could be a request soon.
If the typical person at the bank that does this is on leave it might be good to learn who is sitting at that desk now. for example. There might be some procedures to making an official request, like you can’t just send a text in the middle of the night and expect results or a response even.
I don’t know if it matters or if anyone asks but if you have reoccurring business with a client you might let them know a letter of support saying, ‘I hire this person twice a year for the past five years and anticipate doing so in 2023’ could be useful to you.
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