Discussion:Requests from lendors for proof of self employment
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| {{ForumReplyPost|UserID=Danw|Date=5 January 2006|Text=Lenders here in Delaware infrequently require a "letter from your CPA" saying that you have been self-employed. Given the new IRS rules requring authorization to disclose (want to talk about stupid - requiring 12 CPI type, etc.), and, given the potential liability, I always recommend the client provide copies of the tax return and copies of the business license to the lenders instead. In 26 years of business, this has always sufficed. Dan}} | {{ForumReplyPost|UserID=Danw|Date=5 January 2006|Text=Lenders here in Delaware infrequently require a "letter from your CPA" saying that you have been self-employed. Given the new IRS rules requring authorization to disclose (want to talk about stupid - requiring 12 CPI type, etc.), and, given the potential liability, I always recommend the client provide copies of the tax return and copies of the business license to the lenders instead. In 26 years of business, this has always sufficed. Dan}} | ||
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| + | {{ForumReplyPost|UserID=Anuenue|Date=5 January 2006|Text=DZCPA | ||
| + | It's a Hawaii thing too...I'm not in CA although when I was it was. Anyhow I would still recommend to the client that they use the Sch C as proof. | ||
| + | aloha, anuenue}} | ||
Revision as of 22:49, 5 January 2006
Discussion Forum Index --> Tax Questions --> Requests from lendors for proof of self employment
| 4 January 2006 | |
| I prepared many letters this last year requesting proof of self employment by a CPA letter for clients obtaining real estate loans. Do you do this for free or charge? How much? Some of these lenders can be pushey "I need the letter in 1 hour"! | |
| 4 January 2006 | |
| I would be careful of this as you may be opening yourself up to a law suit if a client defaults on the loan.
There were two pretty good discussions in the misc.taxes.moderated newsgroup a few years back. You can access them via Google Groups, but I have reduced the very long URLs at tinyurl.com: The Tiny URLs are: http://tinyurl.com/98zbl and http://tinyurl.com/8sbyj | |
| 4 January 2006 | |
| With all the new CPA porfessional standards out and the recent public probelms, does providing these letters rise to an assurance service, such as limited scope opinion? After all, you are kind of providing an attestation function to a third party. I've provided copies of prior year tax returns, but I haven't been ask to prepare a formal letter yet, just curious... | |
| 4 January 2006 | |
| Actually, letters state I have prepared their income tax returns for the last 2 years and during this time they were self employed and filed a schedule C. I do not think CPA professional standards apply to me stating what I did on a tax return. These letters pertain to clients that are obtaining stated income loans where they are not showing actual returns to the lendors. | |
| 4 January 2006 | |
| I charge the client for my time say $100 to state in a letter that the client represents he has made a certain amount during the current year and a tax reported schedule c for prior years.I do not represent anything personally. These mortgage people dont seem to care that you tell them only what your client has told you. It is a little ridiculous. | |
| 4 January 2006 | |
| Why would the lender need a letter from the tax preparer? All the lenders I know of ask for the last two tax returns. The Sch C on the return makes the self-employment obvious...If my clients ask, I tell them to provide copies of the Sch C.
anuenue | |
| 5 January 2006 | |
| Anuenue, Must be a California thing. People here can get loans without showing their tax returns and just stating their incime on a loan appication. No proof needed. This has become very popular in the last 2 years. | |
| 5 January 2006 | |
| Lenders here in Delaware infrequently require a "letter from your CPA" saying that you have been self-employed. Given the new IRS rules requring authorization to disclose (want to talk about stupid - requiring 12 CPI type, etc.), and, given the potential liability, I always recommend the client provide copies of the tax return and copies of the business license to the lenders instead. In 26 years of business, this has always sufficed. Dan | |
| 5 January 2006 | |
| DZCPA
It's a Hawaii thing too...I'm not in CA although when I was it was. Anyhow I would still recommend to the client that they use the Sch C as proof. aloha, anuenue | |
