You're applying for that new car loan. You're ready to purchase your first home or sign a lease with a new apartment complex. Whatever the case may be, you've found yourself in a situation where you need to provide proof of income.
What can be used as proof of income though?
Before you decide to sit down with a lender or visit a landlord to sign a lease, you need to have all of your essential documents together. If you come prepared, the process will be much simpler and stress-free. First, call ahead of time and ask what all is needed from you.
If proof of income is needed, then you'll need to know how you're going to show your income. Luckily, there are a few different ways that you can provide proof of income.
Below is our list of several items you can use as proof of income documents. Continue reading to learn more!
1. Your Paystubs
Some employers will still disperse paystubs to their employees. If your employer does so, then you most likely receive your paystubs with your paycheck each time you're paid. Take these paystubs and make copies of them.
You can then give the copies to the person requesting the proof of income. If your employer doesn't give you paystubs and you're paid by direct deposit, then you can ask your employer to send you your last 3 paystubs. Give them enough time to do so, and they should have no problem sending you them.
If your employer is unable to send you paystubs or can't get it done by the time you need them, then you can also consider using a paystub or paycheck template.
The template will have you enter your employer and employee information as well as your earnings, hours, and other typical information found on a paystub. Provide accurate information and then use this template as proof of income.
2. Your Bank Statements
If you're paid a direct deposit or paid through a system that then transfers your money to your bank account, then you can use your bank statements as a form of proof. Head into your bank and ask them to print out your bank statements for the past month or two.
You can then highlight or circle each deposit made into your account from your employer. You can also have your bank fill out a form that states how much money is deposited into your account each month, and they'll sign and stamp it for you.
Because bank statements don't always show the most accurate income statements, it's important that you speak with the person requesting your proof of income and ask if the bank statements will work as a proof for them.
3. Your Tax Return Forms
Each year when you file your taxes, you're given a tax return form or statement. After you file taxes, ask your accountant to give you copies of your tax return (they should do this regardless). If you don't use an accountant and file your own taxes, be sure to print these forms out.
Your tax return forms will show how much money you made throughout the year and how you're making this money. This will act as a great proof of income.
Make copies and then use these as your proof of income. Never give someone the originals, as you'll need to keep those for your own records.
4. Proof of Income Letter
When you have difficultly finding a way to provide proof of income, you can request your employer to write you a proof of income letter. This is a common way to show proof of income for people who work as contractors, freelancers, or self-employed individuals.
The letter can come from an employer or from a person or company that pays you for your services. The letter should include your personal information such as your name and who you are to the person writing the letter.
It should include the type of work done, the amount paid for the work, and the date. To make things easier, you can fill out a template with this information and then have the person sign off on it. If all information is correct, then they should have no problem signing it for you.
5. 1099 Statement
One of the last ways to show proof of your income is to use your 1099 statement. A 1099 statement is provided to individuals who are self-employed and make over a certain amount of money throughout the year. The 1099 statement is a miscellaneous income statement and is used to file taxes.
If you're provided with this statement, you can make a copy of it and use it to prove your income. Do keep in mind, however, that this is a tax form and won't be sent to you until tax season.
If you need to provide this proof before tax season arrives, then you'll need to find another way to show proof or inquire about using your 1099 statement from the year before.
Stop Wondering What Can Be Used as Proof of Income and Use These Options
If you were once wondering what can be used as proof of income, we hope you now know how to show proof. Use the options listed in this guide above to show your proof of income, no matter what you need it for.
