There are many reasons why another party will ask you for income proof. For example, if you want some form of credit you will need to prove that you have the income to pay back that debt. Other common reasons include renting property.
Your landlord may want some sort of formal assurance that you’re able to pay the rent over the rental period. For most people, proof of income needn’t be a big issue as they’re employed and can ask their employer to confirm their income.
Once you move into the self-employed world, or you hold down multiple jobs then it can be a little more challenging. In this article, you will read about how to provide income proof, the answer to which will aid you in gaining greater financial freedom.
Can’t Beat the Tax Man
Most often, it’s the taxman that’s chasing us for information. However, this is one of those more rare moments when you can chase the taxman for information to use as proof of your income. There are several tax documents you may like to use.
Your tax return is a logical place to begin proving your income. Your tax payments are calculated based on your declared income so it’s a solid way of proving what that income is. If you’re self-employed and never had to do this before you will find the tax return on the IRS website along with guidance on how to complete it.
It’s possible that the income you’re able to show in your tax return is not sufficient for the purpose with which you want to prove that income. In which case, you need to prove other sources of income that may be taxable and be used as a reference for income proof. That brings us to miscellaneous income and the 1099 form.
This form includes other sorts of work that you may have done on an informal basis and been compensated for. Depending on the nature of your work, and if you’re using an accountant, you may not be even aware that this form is a possible means to prove your income.
This is another tax form that may serve your purpose so don’t forget about it. It’s the W-2 Income Statement. If you’re no longer employed part way through the year this will demonstrate the income you’ve already earned. That combined with your typical expenses may help to show demonstrate the health of your finances.
Other Sources of Income Proof
There are numerous other sources that you could use to prove your income such as a record of severance payments, insurance payouts, social security statements, and even unemployment statements.
Pay stubs for renters or anyone else looking for income proof is an excellent idea, very easy to use, and convenient. You can easily complete online, have a permanent record, and use this information to secure various forms of credit.
Time to Prove It
In this article, you’ve read about various ways of providing income proof. One of the best sources is the IRS. Of course, there are other ways too, all of which combined will serve most of your needs.
All of these methods have something in common, and that’s they take a little bit of time to prepare. However, a measure of financial flexibility that comes with being able to prove your income is well worth it. Talking of money, check out our online store for the NFL Diamonds official logo hoodie.