When you’re self employed, proving income isn’t as simple as handing over pay stubs. Lenders, landlords, and even private money lender programs want third-party verification grounded in your tax returns, bank statements, and year-to-date financial statements. That’s where a letter from a Certified Public Accountant (CPA) comes in. But what should you expect to pay—and what drives the price?
This guide explains the Cost of getting a CPA letter for self-employed individuals, how firms set fees, what “light” vs. “heavy” engagements look like, and ways to keep the bill under control without compromising accuracy, credibility, or compliance.
This article is educational, not tax, legal, or accounting advice. Engage your own CPA for guidance specific to your situation.
What Exactly Is a CPA Letter (and What It Isn’t)
A concise verification—not an audit
A CPA letter is a signed statement—often a one-page PDF on firm letterhead—confirming your income and self-employment status, based on objective records: filed tax returns (e.g., Form 1040 with Schedule C), YTD P&L, balance sheets, cash flow statements, and corroborating bank statements. It’s meant to help a third party (e.g., lenders, landlords) understand your numbers quickly.
Engagement scope matters
This is not an audit or review unless you explicitly purchase those services. A typical letter states limits, references standards (U.S. GAAP or International Financial Reporting Standards where applicable), and often cites the CPA’s professional liability/errors and omissions (E&O) coverage—one reason letters aren’t “free.”
The Big Picture: What Drives the Fee
Cost drivers you can control
- Document quality & reconciliation: Clean books that tie to what you filed with the IRS = lower hours.
- Complexity: Single sole proprietor vs. multi-entity LLC structure; owner payroll; affiliates.
- Scope & recipient needs: Mortgage lending underwriters may want deeper tie-outs than a landlord.
- Timing: Rush requests, refinance deadlines, or last-minute loan conditions add cost.
- Risk & compliance: Firms price in risk (liability/E&O, AICPA ethical standards) and reviewer expectations.
Cost drivers you can’t control
- Regional billing rates, firm size, and insurance overhead (E&O liability insurance).
Typical Price Ranges by Service Type
Ranges below reflect common U.S. billing realities for straightforward cases. Complex files can exceed the high end.
1) Landlord / Basic Tenant Verification Letter
- $100 – $300
- One-page confirmation for landlords: time in business, entity/ownership, and prior-year/YTD income.
- Usually based on filed tax returns and a quick scan of YTD financial statements.
When it costs more
- Missing or messy records; new LLC with incomplete books; multiple revenue streams without clear tracking.
2) Mortgage / Home Loan / Refinance Letter
- $250 – $600 (letter only, organized client)
- Aligns with mortgage/mortgage loans checklists: two years tax returns, YTD P&L, balance sheets, cash flow statements, and 2–6 months bank statements.
- The CPA clarifies expenses, deductions, and timing differences under underwriting criteria.
Add-ons you might see
- Document cleanup: +$300 – $1,500 if books don’t tie to the IRS.
- Multi-entity or payroll tax issues: +$200 – $600 per entity/issue.
- Rush delivery: +20% – 50% premium.
3) Business Loan / Private Money Lender Package
- $300 – $900
- Similar to mortgage letters but tailored to the lender’s lending ratios and creditworthiness metrics.
- May include short notes on assets or working-capital trends.
4) Compilation-Level Packaging
- $1,000 – $3,500
- If your financials need formal accounting presentation (a compiled P&L, balance sheet, and cash flow), expect a separate compilation engagement plus the letter.
- Helpful when underwriters want standardized financial reporting and not just management spreadsheets.
5) Review-Level Procedures
- $3,000 – $9,000+
- Not typical for a routine letter, but sometimes requested by conservative institutions. Involves inquiries/analytics under SSARS; higher assurance than a compilation, still below audit.
6) Special Situations & Extras
- IFRS mapping or international consolidation: +$500 – $2,500
- Amended returns or prior-year rebooks: time & materials; can eclipse the letter cost.
- Payroll / payroll tax tie-outs (S-corp wages, officer comp): +$200 – $800
- Expedited weekend/holiday work: premium rates.
Why Letters Aren’t Free: Risk, Liability, and Standards
Professional responsibilities
A CPA’s signature carries credibility but also risk. Firms must vet numbers against source tax forms and ledgers, follow AICPA ethics, and maintain liability insurance (E&O). If a letter is used beyond its intended purpose—or numbers prove inaccurate after the fact—exposure exists. Pricing reflects that risk.
Accuracy and compliance language
Expect phrasing that cites accuracy to the documents reviewed and clarifies that the letter is verification, not a guarantee of loan approval or future income.
Cost Check: CPA letter vs. bank statement for income proof
When a letter is better
- Underwriters need context: how expenses, deductible items, and Schedule C or S-corp distributions affect taxable income.
- You’re explaining swings or seasonality that raw deposits can’t show.
When bank statements shine
- Fast “can you pay?” checks for landlords; confirming reserves/down-payment capacity for home loan programs.
- Useful corroboration for cash consistency.
Best practice
For mortgage lending, you usually need both: returns/financials anchored to the IRS, bank statements for liquidity, and a CPA letter tying it together. For rentals, many landlords will accept a letter plus a few months of statements.
How to Keep Your CPA Letter Affordable
Prep a clean packet
- Two years tax returns (with all schedules), YTD P&L, balance sheets, and cash flow statements (exported to PDF).
- Recent bank statements (2–6 months).
- Entity documents (LLC articles, ownership %, EIN).
- Notes on big expenses, one-offs, or timing quirks.
Reconcile before you send
Tie totals to the IRS. If your 1040 shows different numbers than your books, fix it first; cleanup is cheaper before the CPA starts drafting.
Specify the purpose and recipient
- “For mortgage underwriter at [Lender Name] regarding refinance.”
- “For [Property Manager] rental application.”
- Clear scope prevents “scope creep” (and surprise fees).
Don’t ask for assurance you don’t need
Letters are verification, not attest opinions. If a third party demands a review or audit level, expect a much higher price—and more time.
Consider timing
Avoid rush fees by asking early—ideally before you’re under a tight down payment closing clock.
Example Scenarios & Estimated Costs
A) Sole proprietor, organized books, landlord letter
- Packet ties to IRS; consistent deposits.
- Estimated fee: $150 – $250.
B) LLC owner seeking mortgage with two income streams
- Full underwriting checklist; small reconciliation needed.
- Estimated fee: $350 – $700 (+$300 if cleanup required).
C) Private lending program with liquidity schedules
- Needs brief assets summary and 6 months bank corroboration.
- Estimated fee: $400 – $900.
D) Compilation requested by conservative lender
- Formal compiled statements + letter; no review assurances.
- Estimated fee: $1,500 – $3,000.
What Reviewers Actually Expect in the Letter
Core elements every letter should contain
- CPA firm identity, license, contact, date, and signature.
- Client legal name, entity (sole prop/LLC), years in business.
- Basis of verification (returns, YTD financials, bank statements).
- Income summary (two years + YTD).
- Purpose/recipient and limitation language.
- Framework used (GAAP/International Financial Reporting Standards, if relevant).
Optional but helpful
- One-line context for large swings; confirmation that figures reconcile to filed tax.
- Note that the firm maintains E&O coverage (no policy details).
Red Flags That Increase Cost
Inconsistent filings
- Numbers don’t match IRS returns; unexplained gaps in deposits.
- Fix: Reconcile and annotate differences (timing, amended return, etc.).
Scope creep
- Letter requested for a home mortgage, then reused for a business loan with new requirements.
- Fix: Get purpose-built versions; it’s often cheaper than retrofitting.
Payroll & compliance issues
- Unfiled payroll tax forms or messy owner compensation in an S-corp.
Fix: Clean up with your CPA first; the letter follows easily.