H. Net Income from a Business

The following documents show income for the prior years. Owners must consult with tenants and use this data to estimate income for the next 12 months.

1. IRS Tax Return, Form 1040, including any:

   • a. Schedule C (Small Business);

   • b. Schedule E (Rental Property Income); and

   • c. Schedule F (Farm Income).

2. An accountant's calculation of depreciation expense, computed using straightline depreciation rules. (Required when accelerated depreciation was used on the tax return or financial statement.)

HUD Occupancy Handbook Appendix 6-C: Guidance About Types of Information to Request When Verifying Eligibility and Income

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Appendix 6-C

4350.3 REV-1

3. Audited or unaudited financial statement(s) of the business.

4. Loan Application listing income derived from the business during the previous 12 months.

5. Applicant's notarized statement or affidavit as to net income realized from the business during the previous years.

• I.