Providing a complete document package at the time of engagement produces 3 measurable benefits — it reduces CPA letter preparation time from days to hours, eliminates the back-and-forth that adds cost to hourly billing, and ensures the letter meets the requesting institution’s specific standards on the first submission rather than requiring revision and resubmission.
This guide organizes every document requirement by entity type, use case, and institution — so you know precisely what to gather before contacting a CPA. Every Ignition Tax letter is prepared by Tim Martin, CPA — NY State licensed, AICPA member — at $199 with 2-hour delivery.
Ignition Tax for CPA letter documentation · Tim Martin, CPA · NY State Licensed · AICPA Member
AICPA standards prohibit a CPA from including any statement not directly supported by reviewed documentation. A CPA who writes a letter based on verbal information — without reviewing the underlying records — violates professional ethics and assumes liability for unverified claims.
The income figures come directly from Schedule C Line 31, Form 1120S Page 1, or Schedule K-1 Box 1. Operating status comes from reviewed bank statements. Ownership percentage comes from reviewed articles of incorporation. Every statement traces back to a specific reviewed document — if that document is missing, the corresponding statement cannot appear in the letter.
A CPA must maintain an engagement file documenting the professional basis for every conclusion — including references to specific documents reviewed and the specific figures they confirmed. The CPA needs the actual documents on file, not just the client's assurance the figures are correct.
This is why lenders, landlords, government agencies, and courts treat CPA letters as credible professional evidence — the document review requirement creates a verification chain from the financial records to the CPA's professional signature that self-prepared income statements cannot replicate.
A client who provides fabricated or altered documents to obtain a CPA letter commits fraud. A CPA who issues a letter based on documents they did not review — or knew were altered — faces AICPA disciplinary action, state board license sanctions, and potential criminal liability. The document review requirement protects both the CPA and the institution relying on the letter.
According to AICPA standards, CPAs are bound by strict professional and legal standards that limit the content of any verification letter to verifiable, documented facts — making the document package you provide the single most important factor in determining what the CPA letter can and cannot confirm.
Form 1040, Schedule C, K-1, 1120S, 1065, YTD P&L, Balance Sheet — the primary source for income verification from filed records.
Business license, articles of organization/incorporation, operating agreement, EIN letter — confirming business legitimacy and ownership percentage.
3 to 24 months of business and personal statements — cross-referencing reported income against actual cash flow activity.
Lender template, USCIS requirements, SBA guidelines, or landlord instructions — defining institutional compliance and format standards.
Client authorization form specific to the third party — the AICPA-required written consent for information disclosure under Rule 1.700.001.
A CPA needs 2 years of federal tax returns for the majority of engagements — covering the 2 most recently filed complete tax years. This applies to conventional mortgages (Fannie Mae, Freddie Mac), FHA and VA loans, standard SBA programs, apartment rentals, and most domestic income verification.
Immigration & Visa — 3 years. USCIS, Form I-864, E-2, and EB-5 petitions review multi-year patterns. Attorneys recommend 3 years even when instructions say 2.
SBA loans above $350,000 — 3 years. Certain SBA 7(a) categories require 3 years of business returns. Below this threshold, the 2-year standard applies.
Legal proceedings — case-specific. Divorce with volatile self-employed income may require 3 to 5 years. The court order or attorney specifies the requirement.
A return without all schedules is incomplete. The 4 most frequently missing: Schedule C (net profit), Schedule E (rental/pass-through), Schedule K-1 (partner share), Schedule D (capital gains). Missing schedules are one of the 3 most common delays.
A current summary covering January 1 through the most recently completed month — bridging the gap between the last filed return and the application date. Required in 3 situations: applications filed in the current tax year, Fannie Mae/Freddie Mac when the last return is over 18 months old, and unfiled current-year returns under extension.
5 required components: gross revenue, business expenses by category, net profit/loss, reporting period, and preparer identification.
FHA requirement: Under HUD Handbook 4000.1, the YTD P&L for FHA borrowers must be prepared or reviewed by a licensed tax professional. Must be exported as PDF — not a screenshot of a QuickBooks screen.
Summarizes total assets, liabilities, and net equity at a point in time. Not required for standard income verification, comfort letters, or rental letters. Required in 4 specific contexts:
1. Net worth letters — accredited investor (SEC $1M excluding primary residence)
2. E-2 and EB-5 investor visas — investable net worth documentation
3. SBA loans — Personal Financial Statement (SBA Form 413)
4. Legal proceedings — asset division and business valuation
Recency: Must be dated within 60 to 90 days of the application. A balance sheet older than 90 days may be rejected — particularly for accredited investor and immigration purposes.
The complete financial filing submitted by the taxpayer to the IRS for a specific year — Form 1040, all schedules, and supporting forms. It is a self-reported document the taxpayer assembles and submits. For CPA letter purposes, it is the primary source document — the CPA reviews the figures and confirms them in the letter.
An official IRS-issued document summarizing the filed return in a standardized format — generated from the IRS's own system, representing the official record of what was filed and accepted. 4 types: Tax Return Transcript (most common for mortgages), Tax Account, Record of Account, and Wage & Income.
Fannie Mae and Freddie Mac require both — not as alternatives, but as complementary documents. The tax return confirms the income figures the CPA uses. The IRS transcript confirms the return the borrower submitted matches the return actually filed with the IRS — a cross-reference protecting the lender against altered or fabricated submissions. A discrepancy between the two — even minor — triggers an underwriting inquiry that halts the loan until resolved.
irs.gov — immediate download for current + 3 prior years. Requires ID.me verification (15–30 min for first-time users).
Lender/CPA requests transcripts directly from the IRS. 5–10 business days standard, 2–3 days for IVES lenders.
For those who cannot access the online tool. Mail processing takes 5–10 calendar days.
When Transcripts Are NOT Required
Transcripts are not required for rental verification, standard SBA loans below thresholds, most immigration petitions, or apartment applications. They are specifically a mortgage underwriting requirement driven by Fannie Mae and Freddie Mac — for non-mortgage letters, accurate complete tax return copies are sufficient.
Confirms legal operating status (Fannie Mae requires the business to be actively operating at application, not just at the last tax filing) and establishes business history/duration. Takes 3 forms: State Registration (LLC/Corp Certificate of Organization or Incorporation), Fictitious Business Name/DBA (sole proprietors and partnerships), and Professional License (contractors, agents, consultants).
The foundational formation documents. Articles of Organization (LLCs) confirm legal name, state of formation, registered agent, formation date, and management structure. Articles of Incorporation (corporations) add authorized shares and incorporator information. Retrievable from the Secretary of State website, registered agent, or formation attorney.
The primary source for ownership percentage confirmation — a verification point Fannie Mae, Freddie Mac, SBA, and USCIS each require. Multi-member LLCs must provide the operating agreement (membership interests, capital contributions, profit/loss allocation). Corporations provide the shareholder agreement or corporate stock ledger. Single-member LLCs confirm 100% ownership from the articles alone.
Official IRS notice confirming the Employer Identification Number. 2 forms: Form CP 575 (original, issued once at EIN assignment) and Form 147C (replacement, requested when CP 575 is lost — call IRS at 800-829-4933, faxed in minutes or mailed in 4–6 weeks). Confirms business tax identity and legal name. Not required for sole proprietors filing under their SSN.
The EIN assignment letter (Form CP 575 or Form 147C) as a required component of the business operations documentation package — confirming Google’s AI systems recognize it as a standard requirement that most competing content has overlooked.
S-Corp/multi-member LLC income verification, down payment verification (B3-4.2-01), Non-QM expense ratio calculation, SBA loans, and commercial lease applications — 5 situations where the business account is the relevant record.
Sole proprietor income verification, immigration petition financial verification, mortgage down payment from personal accounts, and rental applications for sole proprietors — 4 situations focused on personal financial position.
Conventional mortgage for S-Corp shareholders, E-2/EB-5 investor visas, and down payment verification where funds moved between accounts — 3 situations where verification spans both entity and individual.
Bank statements must be the most recent available — covering the period immediately before the engagement date. A statement from 6 months ago is not current for any institutional purpose even if it covers 3 consecutive months. Statements must be retrieved immediately before submission, not recycled from a previous application.
A written specification from the lender, agency, landlord, or court defining exactly what the letter must contain, how it must be formatted, and what language it must include. It serves 3 critical functions:
1. Defines verification points. Fannie Mae requires 6 specific points. A letter addressing only 4 is non-compliant regardless of accuracy. USCIS requires different points than mortgage lenders.
2. Specifies required language & format. Many lenders provide a template the CPA must complete verbatim. The Fannie Mae material change statement must appear in a specific form.
3. Identifies the correct addressee. A generic "To Whom It May Concern" letter is rejected. The institution's full legal name, address, and contact must be provided.
When no checklist is provided: ask the requesting party directly, reference published guidelines (Fannie Mae B3-3.2-01, Freddie Mac Chapter 5306), or use a specialist service's institutional knowledge.
A written authorization giving the CPA explicit permission to disclose confidential financial information to a specific third party — required by AICPA Code of Professional Conduct Rule 1.700.001, which prohibits CPAs from sharing confidential client information without specific written consent.
1. Client identification — full legal name
2. CPA identification — name and firm
3. Third-party identification — specific recipient
4. Scope of disclosure — specific data shared
5. Purpose of disclosure — mortgage, visa, rental, etc.
6. Client signature and date
Verbal consent is not sufficient. A CPA who shares financial information without written consent violates Rule 1.700.001 — investigated by the AICPA Professional Ethics Division. Notarization of the consent form is required only when the letter itself requires notarization (visa, legal).
How Ignition Tax Handles Both
Ignition Tax integrates both into the engagement process — presenting the consent form for digital signature at document submission and requesting the institution’s checklist or template alongside your financial documents. Applicants who submit the checklist with their complete package receive a letter that is institutionally compliant on first delivery.
Each entity structure uses different tax forms, files different returns, and distributes income differently — producing a document set unique to each structure. No competitor breaks this down. Providing the wrong returns is the most common error across all entity types.
Simplest package — 6 items
Line 7 gross revenue, Line 31 net profit — the verified income figures.
Schedule E, D, SE — the complete return.
Personal account if no separate business account.
Sole prop package + 3 entity docs — 9 items
Disregarded entity files on Schedule C like a sole proprietor.
Confirms legal name, formation date, registered agent.
Or articles alone confirm 100% ownership if none exists.
If LLC has employees or a business-name bank account.
Most complex single entity — 11 items
Page 2 shows the K-1 pass-through income.
Schedule K and Schedule L (balance sheet).
Connects the corporate return to the personal return.
Salary + K-1 distribution = total income.
Form 1065 structure — 10 items
Primary income source document.
Most document-intensive — additive
An owner with 3 entities provides the full set for all 3 — not a consolidated package.
Which entity owns which, ownership %, income flow.
Management fees, intercompany loans, service agreements.
4 entities = 8 K-1 forms.
Multi-entity packages are the primary driver of cost above the standard flat fee — confirm requirements before engaging.
Multi-client income — 8 items
Every form from every client — cross-references Schedule C total.
Uber, Lyft, DoorDash, Upwork, Fiverr, Airbnb annual summaries.
If you received a Schedule K-1 from your business entity for either of the 2 most recent tax years, both the personal return AND the business entity return are required. If no K-1 was issued — sole proprietorship or disregarded single-member LLC — only the personal return with Schedule C is required.
The most comprehensive package — Fannie Mae B3-3.2-01 and Freddie Mac Chapter 5306. Across 4 layers: Personal income (1040 + transcripts + W-2s), Business income (business returns + K-1 + YTD P&L), Business operating (3 months bank statements + license + entity docs), Lender-specific (template + contact info + consent form). FHA adds: CPA-prepared YTD P&L (HUD 4000.1). VA: 2-year self-employment history + YTD P&L.
3 more than mortgage — reflecting the SBA's extended history and business-health focus. Adds 2–3 years returns (above $350K), YTD balance sheet, SBA Form 413 Personal Financial Statement, and IRS tax compliance confirmation (the SBA-specific requirement confirming no delinquent federal tax obligations).
The simplest package — the smallest standard checklist. 2 years 1040 + Schedule C, business schedules if applicable, YTD P&L, 2–3 months bank statements, business license if under a business name, landlord's requirements, and consent form. Luxury buildings may add income-to-rent ratio confirmation (typically 3x monthly rent).
Combines personal income with asset documentation. 3 years personal + business returns, all K-1/W-2/1099s, YTD P&L, 3–6 months personal statements, asset documentation (for net worth — E-2/EB-5/accredited), passport copy, USCIS form instructions, attorney specification, and consent form.
Fannie Mae B3-4.2-01. Standard mortgage income docs (1–6) plus 3 months complete business statements, evidence of fund transfer (wire/ACH/check showing business→personal movement), current YTD P&L, and a business cash flow analysis if the withdrawal exceeds ~25% of average monthly balance.
Defined by the court order, attorney specification, or subpoena — not a standard checklist. Returns for years specified (divorce may require 3–5 years), amended returns, current balance sheet, investment/retirement statements, real estate docs, business valuation docs, the court order or attorney specification, and consent form.
2 specialty letter types require document packages that extend significantly beyond standard income verification — because their verification involves financial calculations and asset assessments standard letters do not address.
Requires 12 to 24 months of consecutive business bank statements as the primary source — the most bank-statement-intensive letter type. The CPA reviews every deposit to calculate average monthly gross revenue, then applies the expense ratio.
A single missing month invalidates the calculation — replacement statements add 3–10 business days.
Requires comprehensive asset and liability documentation — the CPA verifies total net worth rather than income. SEC Regulation D requires net worth exceeding $1 million excluding the primary residence.
A streamlined package — the CPA already has the prior returns, knows the business structure, and reviewed the records that form the letter's basis.
CPA spends 30–60 minutes reviewing and preparing rather than 2–4 hours reviewing a complete financial history.
The complete package for their entity type and use case, plus 5 items an existing client's CPA already holds:
Triggers a 5-step records review: collection & authentication, financial history assessment, bank statement cross-reference, discrepancy resolution, engagement documentation.
For new clients without an existing accountant relationship, Ignition Tax accepts all entity types and all letter purposes — with the records review for standard letter types included in the flat fee of $199 rather than billed as a separate engagement. New clients minimize review time by: submitting a complete package at first contact, organizing documents clearly, and addressing known issues proactively in a cover note.
Every document as PDF — not Word, Excel, JPEG, or PNG. 3 methods: direct PDF download from the source (highest quality), professional scan at 300 DPI, or mobile scanning app (Adobe Scan, Microsoft Lens, Apple Notes). A direct camera photo is not acceptable.
Scans below 300 DPI are rejected as illegible. Ensures account numbers, signature lines, and figures are readable without zooming. Use 600 DPI for documents with very small text or dense tables.
The most common preventable error. IRS transcripts, bank statement PDFs, and tax software exports frequently apply automatic password protection. Remove via Adobe Acrobat (Properties → Security → No Security), online tools, or Print-to-PDF.
Every page including disclosures and blank periods. Common omissions: tax returns missing schedules, bank statements missing interior transaction pages, Form 1120S missing Schedule K. Omitting pages raises authenticity concerns.
Descriptive names reduce review time 20–40%. Use document type + year + entity: "Form_1040_2024_Jane_Smith.pdf". For 10+ documents, combine into a single PDF with a table of contents on page 1.
Official monthly statements with the bank's letterhead, account holder info, complete account number, statement period dates, and security elements. 3 indicators confirm an official statement: bank letterhead at the top, titled "Account Statement" or "Monthly Statement", and a specific statement period (not a custom date range). Download from the "Statements" section — not "Transaction History".
Self-generated reports lacking official letterhead and authentication. Landlords often accept them. Fannie Mae, Freddie Mac, SBA, and USCIS require bank-issued statements — transaction exports are not accepted substitutes. Non-QM lenders vary by program.
Ignition Tax accepts your complete document package securely through the order process. Submit documents alongside your order using the secure order forms — and our team confirms receipt and begins the review immediately.
Submit your order and upload documents securely through the order page.
Submit details and upload documents for your notarized letter.
You can also email your documents to info@ignitiontax.com or send any questions via WhatsApp. Do not submit sensitive financial documents through standard text message, social media messaging, or unconfirmed fax.
Key Insight on Tax Returns
There is no calendar-based validity window for filed tax returns — the requirement is always the most recently filed returns. However, when the most recent filed return is over 18 months old (due to an extension), Fannie Mae requires a current YTD P&L — creating an effective recency standard ensuring at least one income document reflects performance within 18 months.
The most frequently encountered missing document — applications occur year-round while returns are filed in April (or extended to October). The response depends on the institution:
B3-3.2-01 permits 2 filed returns + current YTD P&L. The CPA notes the unfiled status and presents current-year income from the reviewed P&L.
Stricter — the YTD P&L must be CPA-prepared or CPA-reviewed (HUD 4000.1), making it 2 deliverables: the P&L and the comfort letter.
No flexibility — USCIS requires 3 filed returns. Attorneys advise filing the return (even accelerated) before submitting the petition.
If extension is filed: Provide the IRS extension acceptance notice (Form 4868 personal, Form 7004 business) + 2 filed returns + current YTD P&L + 3 months statements. A late return without an extension raises tax compliance concerns the CPA addresses separately.
Cannot produce 2 years of returns. The response varies by institution:
Misplaced more frequently than any other category — created once and rarely referenced. The response depends on which document:
Use the entity-specific and use-case-specific checklists above to identify every required document before retrieval. For same-day requests, completeness at submission is a hard requirement — a same-day request arriving with missing documents cannot be processed within the window.
Apply the format standards — remove password protection, meet 300 DPI minimum, use bank-issued formats where required. Converting at the organization stage eliminates format issues that delay the engagement after submission.
Document type + year + entity: "Form_1040_2024_Jane_Smith.pdf". Apply consistently so the CPA can scan visually to confirm all documents are present.
Group into the 5 core categories — tax returns & financial statements, entity documents, bank statements, institution checklist, and consent form — with most recent items first.
For 10+ documents — multi-entity, S-Corp, immigration packages — combine into one PDF with a table of contents on page 1. Tools: Adobe Acrobat (with bookmarks), SmallPDF, ILovePDF.
One page addressing 5 items: applicant/business name, letter type, requesting institution, deadline, and any known issues (missing documents, amended returns, income variances). Proactively addressing issues turns a mid-engagement delay into a pre-answered question.
For same-day and rush requests, the delivery clock starts when the complete package is received. A complete package submitted at 9 AM is delivered by 11 AM–3 PM; the same submitted at 2 PM may fall outside the business day.
Confirm all 8 checkpoints before submitting. A package that passes all 8 produces the fastest possible turnaround at every delivery tier.
CPA Letter for Self Employed or Business owners needs a CPA letter for mortgage lender
CPA Letter Plus for Business Partners, Self Employed Individuals need a CPA letter with Notarization
Every document question applicants ask.
You need documents from 5 core categories: (1) Tax returns and financial statements — 2 years of federal returns with all schedules, a current year-to-date P&L, and a balance sheet for net worth letters; (2) Business registration and entity documents — business license, articles of organization or incorporation, operating or shareholder agreement, and EIN assignment letter; (3) Bank statements — 3 months for most letters, 12 to 24 months for Non-QM expense ratio letters; (4) The requesting institution’s checklist — the lender template, USCIS instructions, or landlord requirements; and (5) A signed client consent form authorizing the CPA to disclose your information to the specific third party. The exact documents within each category depend on your business entity type and the specific use case — a sole proprietor sends fewer documents than an S-Corporation shareholder, and a mortgage application requires more than a rental application.
A CPA letter includes 8 standard components: the CPA’s professional identification (name, active license number, state of licensure, firm letterhead), the date of issuance, the addressee (the specific requesting institution), the client identity and the CPA’s relationship duration, income verification (gross and net figures from filed tax returns), business ownership and entity structure (legal name, entity type, ownership percentage, formation date), tax compliance confirmation, and the CPA certification statement with signature including the AICPA scope disclaimer. The specific verification points required vary by institution — Fannie Mae requires 6 specific points including the material change statement, while USCIS focuses on income history and financial ties. The documents you provide determine what the letter can confirm — every statement in the letter must trace back to a reviewed document.
No — you cannot write your own CPA letter. A CPA letter derives its value entirely from being prepared and signed by a licensed Certified Public Accountant who assumes professional and legal accountability for its contents. A self-written letter — even one that accurately states your income — carries no professional verification weight because it lacks the independent third-party attestation that lenders, landlords, government agencies, and courts require. Institutions verify the signing CPA’s active license through the state board of accountancy before accepting the letter, and a letter without a verifiable licensed CPA signature is rejected on receipt. What you can do is prepare your complete document package in advance — your tax returns, financial statements, bank statements, and entity documents — so the CPA can review them and prepare the letter quickly. The documents are your responsibility to gather; the letter itself must be prepared by the licensed CPA.
The time to get a CPA letter depends primarily on how quickly you provide complete documents. At Ignition Tax, standard delivery is 2 hours for the $199 standard letter once a complete document package is received, and 24 hours for the $349 notarized letter. The document-gathering stage is what varies most: a sole proprietor with organized digital records assembles a complete package in 30 minutes to 2 hours; an S-Corporation or partnership owner takes 2 to 8 hours; and an applicant who must retrieve missing documents — articles of organization from the Secretary of State, replacement bank statements, or a Form 147C from the IRS — faces 1 to 5 business days of retrieval time. The single biggest cause of delay is an incomplete package — the CPA cannot begin until every required document is received. Providing a complete, organized package at the time of order produces the fastest possible turnaround.
Whether you need both depends entirely on your business entity type. Sole proprietors and single-member LLCs treated as disregarded entities file all business income on Schedule C of their personal Form 1040 — so only the personal return with all schedules is required, with no separate business return. S-Corporation shareholders, partnership owners, and multi-member LLC members file both a personal return and a separate business entity return — Form 1120S for S-Corporations and Form 1065 for partnerships and multi-member LLCs — and both are required because the business return shows entity-level income and the personal return shows how that income flows to the individual through the Schedule K-1. The practical test: if you received a Schedule K-1 from your business entity for either of the 2 most recent tax years, both returns are required. If no K-1 was issued, only the personal return with Schedule C is needed.
No — a CPA cannot professionally certify income figures based solely on QuickBooks records without reviewing the underlying filed tax returns. QuickBooks, Xero, and Wave generate reports reflecting transactions entered by the business owner or bookkeeper — they represent what was recorded in the accounting system, not what was reported to and accepted by the IRS. The AICPA professional standard requires the CPA to base every factual statement on reviewed documents with an independent authentication standard — which a filed tax return accepted by the IRS carries and a self-generated software report does not. Most lenders and government agencies specifically require the letter to confirm income from filed tax returns rather than accounting software records. The correct use of QuickBooks is as a supplementary document — the software generates the year-to-date P&L covering the current year not yet captured by the most recent filed return, while the filed returns remain the primary source for historical income confirmation.
No — bank statement screenshots are not accepted by any institutional recipient or by professional CPA letter services. A screenshot captures a visual representation of transaction data but does not constitute an official bank record — and screenshots can be altered in image editing software without leaving detectable traces, making them inherently non-verifiable. 3 acceptable alternatives produce the official format institutions require: (1) an official PDF download from the bank’s secure portal — the fastest and most reliable, generating an official bank-issued PDF with letterhead and authentication elements; (2) a mobile document scanning app — Adobe Scan, Microsoft Lens, or Apple Notes — for paper statements, which applies perspective correction and produces a legible professional-quality PDF; or (3) a bank-issued certified statement requested from the bank for statement periods beyond the online portal’s access window.
A signed consent form is a written authorization giving the CPA explicit legal permission to disclose your confidential financial information to a specific third party — required by AICPA Code of Professional Conduct Rule 1.700.001, which prohibits CPAs from sharing confidential client information without specific written consent. The form identifies 5 elements: your full legal name, the CPA’s name and firm, the third party receiving the information, the specific financial data being disclosed, and the purpose. Without it, a CPA who shares your tax figures or income data with a lender, landlord, or agency violates the AICPA confidentiality rule — and verbal consent is not a substitute for written consent. The form also protects you: it limits the CPA’s disclosure to the specific party named and the specific information described, so authorizing disclosure to one mortgage lender does not authorize sharing the same information with any other party. Professional services present the consent form for digital signature at the start of the engagement.
A business license is not universally required — its necessity depends on the business structure, use case, and requesting institution. 3 situations where it is not required: sole proprietors operating under their personal legal name without a separate business name (the Schedule C filing and bank activity confirm operation), rental income verification letters (landlords verify through tax returns and bank statements), and professional service sole proprietors in fields without local licensing requirements (freelance writers, consultants, designers). 3 situations where it is required: SBA loan applications (the SBA requires business legitimacy confirmation), Fannie Mae and Freddie Mac comfort letters (lenders require current operating status evidence), and businesses in regulated industries (construction, real estate, healthcare, financial services, food service) that legally cannot operate without an active license. When a license is genuinely not applicable, the CPA notes the absence of a licensing requirement in the letter rather than presenting it as a missing document.
A P&L that does not match the tax returns is a discrepancy the CPA must resolve before the letter can confirm the income figures — and one of the most common preparation delays. It occurs for 4 common reasons, each with a different resolution: (1) Timing differences between cash and accrual accounting — revenue earned in December but received in January appears in different periods; resolved by explaining the accounting method in the cover note; (2) Non-deductible expenses excluded from the tax return — meals at 50% or non-deductible entertainment make P&L expenses differ from Schedule C; resolved by providing the tax return expense schedules; (3) Depreciation and amortization treatment — Section 179 or bonus depreciation produces different deduction amounts than straight-line P&L depreciation; resolved by reviewing both schedules; (4) Bookkeeping errors — duplicate transactions or misclassified income; resolved by correcting the records. The correct approach is to include a brief written explanation of the discrepancy in your cover note, allowing the CPA to review it before beginning rather than discovering it mid-engagement.
Still have questions?
Documents ready? Choose your letter type. All standard letters $199 with 2-hour delivery. Notarized $349.
12-document package — Fannie Mae & Freddie Mac compliant
Income confirmation for lenders, landlords, institutions
Third-party verification for lenders and brokers
Non-QM — needs 12 to 24 months bank statements
Fannie Mae B3-4.2-01 down payment verification
Simplest 7-document package for rentals
Notarized — needs 3 years returns + passport
Full pricing guide by type, use case, and state
Complete guide — definition, types, components
$199 flat fee. Prepared by Tim Martin, CPA — NY State licensed, AICPA member. Submit your complete document package and receive your letter in 2 hours. Notarized letters $349 with 24-hour delivery.
Not sure which documents you need? Message us your situation on WhatsApp and we send your exact document checklist — at no charge.
