We have been getting quite a few requests from clients all over the U.S. that need an “Income Projection Letter” certified by a CPA as part of their rental application. This is typically requested of clients that are self-employed, independent contractors, or receive 1099 income. This also is asked from clients who are owners of a single member LLC.
Landlords ask for this letter because self-employment income may be, at times, sporadic or otherwise hard to predict. Since it is a complex task to analyze the income and expenses of a self-employed individual or independent contractor over time, the leasing agent would prefer a CPA to review and create this projection.
Often times clients approach us with a projection already prepared and just need the CPA to “validate” or “certify” the statement. However, the work still needs to be done – all bank statements need to be compared for logical consistency to the income projection. This must also be cross referenced to prior and current tax returns before we can sign off on the projection.
If the contractor also has income from W2, rental real estate, other business ventures, pension, VA items, or other passive activities, this may also need to be broken out on the income projection, depending on the exact format requested by the landlord.
Please contact us anytime if you need assistance with this as we have helped dozens of self-employed individuals get approved on their rental application.