Self employed proof of income through cap1 auto financing

[Anonymous]

I am self employed, and have been for many years. I need to replace my vehicle some time in the next 6 months or so.

credit scores are above 700 across the board. One old paid baddie that should fall off in the next 5 months. It only reports to one agency. 

What do I need for proof of income? My last 2 years tax returns, my accountant was able to deduct things down and taxable income both years was under 15k. 

I do have 6k saved for a downpayment. I went through cap1 pre approval process, and am eligable for 36k loan. They asked for 6 weeks of bank statements.

Beyond that, once I get to an auto dealership, find a vehicle, they pull my credit, are they going to ask for tax returns? I really don't want to walk in there and show such low income and get denied. 

[Anonymous]

I never actually got a loan through Capital One, I just did the process to see what they'd approve me for.  For proof of income I submitted bank statements for a year into the website and they accepted it (or at least it appears).  The "requires proof of income" disappeared a few days after I uploaded proof of income.

Just call and ask what they need.

[Anonymous]

There's a good chance with scores like that and the down payment that Cap One will not require POI. However, if they do require POI they will take either 2 year's professionally prepared tax returns, which they will use schedule C line 31 to calculate income (if 2016 was 30,000 line 31, and 2015 was 35,000 line 31 they will add these together and divide by 2 = $32,500).

Option 2 is: They will accept 3 months, consecutive, complete, PERSONAL, bank statements. They must be in your name and not the business name and they will calculate all deposits for the three months and divide by 3 to calculate monthly income. Another important note is that you can not have any more than 2 NSF fee's within those three months of bank statements.

You can either upload the bank statements to the portal or you can take them with you to the dealer, once the dealer perform's the hard pull and submits you to Capital One the dealer will let you know if Cap One stipulated for POI or not, if they did then you can simply have the dealer handle getting the POI approved.

[Kree]

Generally taxable income is described as gross income minus deductions.  I don't think a 15k taxable income is necessarilly low.

I made 50k salary this year and my taxable income is about 8k.

I think C1 would be more interested in your gross income on your taxes. But I could be wrong.

[Anonymous]

Kree,

Auto lender's will generally consider your Schedule C line 31 as your gross income for that year. This will be the number after all deduction's and so on and so forth.

If you have a ton of deduction's, write-off's, etc then you will be best using bank statements showing total deposits to prove your income rather than tax returns.