The 4506T is a form signed by borrowers that allows the bank to pull their federal tax returns for the last 2 years. Previously most banks would not retrieve the taxes, and qualify everything on reviewing current pay stubs and w2’s. That is not the case anymore; banks are pulling 4506-Ts on every file. I mention this because one issue that may come is for people that receive SS income. With SS income, some people do not claim it as income on their federal returns, because the IRS has a rule, that if you receive under a certain level; 25k for single, and 32k if married filing jointly, and 0 if you are married filing separately; then you do not have to claim it as income. You can use the Social Security Benefits Worksheet to calculate this and that form can found on the IRS.gov site. The worksheet can also be found on the back of the SSA-1099 form the receipt receives at the end of the year. If a bank pulls the borrowers taxes, and they do not see the SS income, please be prepared to document the reason why the SS income was not claimed. The income levels include the SS income and any other income they receive, including tax-exempt interest.
DC Metro Sr Mortgage Broker
Arlington VA Condos
Friday, August 28, 2009
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