Write-offs that save you taxes can shrink your qualifying income. Here's how to plan two years ahead instead of scrambling.
Underwriting uses net income after expenses, usually averaged over two years, with specific add-backs for depreciation and certain one-time items. The deductions that reduce your tax bill also reduce the income used to qualify.
What to bring
Beyond the standard documents, self-employed files need business returns, a year-to-date profit and loss, and often a CPA letter.
- Two years personal and business tax returns, all schedules
- Year-to-date P&L and balance sheet
- Business license or CPA verification of continued operation
- Business bank statements when using a bank-statement program
Alternatives when returns do not tell the story
Bank-statement and asset-depletion structures exist for strong borrowers whose returns understate cash flow. Pricing runs higher than agency, but they close. These often pair with jumbo or investment property scenarios.
Plan the tax year before you buy
If you plan to purchase within two years, tell me before you file. A conversation with me and your CPA in the same week is worth more than any rate shopping you will do later. Start here.
Programs mentioned
- Home Purchase
Buy with a plan, not a guess.
- Jumbo Loans
Financing above conforming limits.
- Investment Property
Financing that scales with the portfolio.
Keep reading
- Debt-to-Income Explained: The Number That Decides Your Approval
How underwriters calculate DTI, which debts count, and the fastest levers to move it before you apply.
- How a Mortgage Closes in 15 Days: The Behind-the-Scenes Timeline
A day-by-day view of what happens between application and signing — and the three things that cause every delay.
- The Appraisal: What It Is, What Happens If It Comes In Low
An appraisal protects the lender, not your feelings about the house. Here's how to prepare and how to respond to a low number.
- The Document List That Gets You Pre-Approved Fast
Most delays come from missing paperwork, not underwriting. Here's exactly what to gather before you apply.