We have been trying to get a loan for a new vehicle and every time we do, we have the problem of proving our income, because we are self-employed. Our tax returns are very misleading, because we get to deduct things that most people don't, Like a % of utilities, property tax, house interest, car interest, business supplies, ect..... So after all the deductions it shows we make far less than we really do. And the lenders don't take that into consideration. What do we do??????
2007-02-23 05:31:25 · 9 answers · asked by Branda` D 2 in Business & Finance ➔ Personal Finance
MR Jack C. We DO NOT cheat on our taxes. WE DO have to pay our fair share!!!!!!!!!! If you don't know what your talking about and can't help, then SHUT UP!!!!!!!!!!!!!!!!!!
2007-02-23 05:45:29 · update #1
Thank you to everyone, I should give you a few more details. Another problem is We don't deposit every check into our checking and savings account, We pay alot of bills by money order and cash since most offices are here in town. So our bank statements don't even give a good source of income. We were approved for a loan for 23,000 based on what we told them we make, when we faxed our tax forms to them they said they would have to drop the amount because it showed far less was made. We even sent them the 1099 to show what he actually made, But they said by law they had to use the amount on the tax form after all deductions. We have been making the same amount payment on the car we are trading in, so we can make the payment, It is just proving that we make more than our taxes show.
2007-02-23 05:57:08 · update #2
If your business isn't making enough money for them to loan you for a vehicle, the only thing you can do is make a bigger down payment or look at a cheaper vehicle.
Can't have it both ways with tax returns I guess.
2007-02-23 05:36:29 · answer #1 · answered by wizjp 7 · 0⤊ 0⤋
Income can't always be proved, and HMRC are aware of this. They are also aware that very few people in your position would declare much of this income. Keep good books - if you sell an item on ebay then you should have a book-entry showing the purchase details of that item. As long as the paperwork matches up and the amount you are banking matches up with your purchase & sales details then you will be ok. Expenses other than stock can be proved by receipts and bills. Don't forget to claim your working from home allowance (if you run the business from home), fuel costs, stationery, advertising, etc etc.
2016-05-24 02:48:46 · answer #2 · answered by Anonymous · 0⤊ 0⤋
why should he stop cheating on his tax return everyone else does, because they are self employeed they have to pay a lot of other taxes that regular people don't as well as paying for people who don't want to work. Why not keep a little more of the money they earned!
But to answer your question you do need a bigger down & the money should show in your bank statements, or go to your own bank and try and get an auto loan.
2007-02-23 05:49:57 · answer #3 · answered by unsure 2 · 0⤊ 0⤋
Branda,
Lenders understand you have more deductions and actually "add back" some of these deductions as income. If you are still coming up short, then it sounds like you do not have enough income to justify this additional debt. Or perhaps your accountant is overaggressive in claiming deductions, so that on paper you are not able to get all the income back. I can't imagine the lender is using the adjusted gross income figure - which is after your deductions come out.
Unless the underwriter used the wrong income figure, and you could always check with the bank, it sounds like you are coming up short.
2007-02-23 05:44:17 · answer #4 · answered by Matt K 4 · 0⤊ 0⤋
Your problem is a common problem with self-owned businesses. You might try preparing a set of financial statements - balance sheet, income statement, changes in financial position. Make sure you write up a description of your business - what it is, what you do, how long you've done it, what are the chances for growth or failure. The main thing the bank wants to know is how are you going to repay them. It's up to you to show them.
2007-02-23 05:44:20 · answer #5 · answered by Scott K 7 · 0⤊ 0⤋
Your tax returns should contain a line that indicates your gross income.
BTW ... most self-employed manage to get loans for vehicles, homes, etc. without the hassle you are indicating. My daughter and her husband are BOTH self-employed and have no problems.
2007-02-23 05:36:58 · answer #6 · answered by istitch2 6 · 0⤊ 0⤋
Go get your own loan rather than getting it at the dealership. Credit unions typically have the best rates and cost very little to join, like $25.
2007-02-23 05:36:48 · answer #7 · answered by Thomas K 6 · 0⤊ 0⤋
use a "statement of income" form from your tax people.
2007-02-23 05:35:07 · answer #8 · answered by Edward C 1 · 0⤊ 0⤋
stop cheating on your tax returns, and pay your fair share of taxes.
2007-02-23 05:39:58 · answer #9 · answered by Jack Chedeville 6 · 0⤊ 1⤋