The short answer
If you're self-employed, you prove income to a landlord with your last two federal tax returns, ideally backed by IRS tax return transcripts, recent bank statements, or a signed letter from a CPA stating the income on those returns. The CPA letter puts it on one page a leasing office recognizes.
An employee hands over two pay stubs and an offer letter, and the application moves on. A freelancer, a consultant or a business owner paid through a partnership or S corporation has no pay stub to hand over. The income is real, but it is spread across 1099s, a Schedule C or a K-1, and the person reviewing the application may not know how to read any of them. This guide walks through your options, what each one actually proves, and where a CPA letter fits.
If you only read one paragraph: lead with your two most recent federal returns, because that is the record landlords trust most for self-employed income. Then make those returns easy to read, either with IRS transcripts that confirm them or a CPA letter that states the totals. Ask the leasing office what it accepts before you pay for anything.
Why landlords ask for proof of income
A landlord is about to hand you a home for a year or more and is counting on you to pay every month. Income is the simplest predictor they have, so most applications ask for proof of it, and many buildings set a minimum income relative to the rent.
For an employee, that proof is easy to check. A pay stub shows a steady salary from a named employer, and a phone call can confirm it. Self-employed income doesn't look like that. It can swing from month to month, it arrives from many clients, and a bank deposit is not the same as the income left after business expenses. A landlord who sees large deposits one month and none the next can't tell whether you earn a lot or a little. What they want is a reliable annual figure, and the best place to find one is your tax return.
That is also why a few months of bank statements on their own often aren't enough. They show money moving through an account, not what you earned after expenses.
Your proof-of-income options, compared
Most self-employed applicants use some combination of the following. None of them is required or accepted everywhere, which is why it pays to ask the leasing office first.
| Option | What it shows | Watch out for |
|---|---|---|
| Federal tax returns (Form 1040 with schedules) | Your reported income for each year, including Schedule C or K-1 business income | Long, full of personal detail a landlord doesn't need, and a leasing agent may not know which line to read |
| IRS tax return transcripts | The IRS's own record of what you filed | Free from your IRS online account, but dense and unfamiliar to many landlords |
| Bank statements | Deposits and balances over recent months | Deposits are not income after expenses, and every transaction is on display |
| Profit and loss statement | Year-to-date revenue and expenses for your business | Usually prepared by you, so a landlord may give it less weight on its own |
| CPA income letter | Total income, AGI and net business income from your returns, on one signed page | It costs money, and whether the landlord accepts it is their call |
Tax returns are the foundation. They are the only document that states your income for a full year after business expenses, and they were filed with the IRS, which gives them weight. Their weakness is readability. A Form 1040 with a Schedule C, a Schedule E and a stack of K-1s is a lot to hand a leasing agent who reviews pay stubs all day.
Transcripts answer the authenticity question. A landlord who worries that a return could be edited can compare it with the transcript, which comes from the IRS. Getting one costs nothing but a login.
Bank statements and a P&L answer a different question: what is happening this year. If your latest return is several months old, or your business has grown since, a year-to-date profit and loss statement backed by bank statements fills the gap between the last return and today.
Need a CPA letter for your apartment?A licensed CPA states the income on your returns, typically within 24 hours.
See the income letter →What a CPA income letter says, and what it doesn't
A CPA income letter, sometimes called an accountant letter for a landlord, is a short letter signed by a licensed CPA that states the income you reported on your federal tax returns. It is addressed to your landlord or management company, for your application.
Ours is based on your last two federal tax returns (Form 1040 with all schedules) and a photo ID. For each of the two years it reports:
- Your total income
- Your adjusted gross income (AGI)
- Your net business income, if you are self-employed
Two optional additions make it stronger. If you upload IRS tax return transcripts and they match your returns, the letter says the returns agree with IRS records. Without transcripts, it doesn't say that. If you add a year-to-date profit and loss statement or recent bank statements, the letter says so, which helps when a landlord wants to see current-year income.
What it does not say
The letter reports the amounts shown in the documents you provide. It is not an audit or a review, so the CPA isn't vouching for anything beyond what the letter states. It doesn't promise you'll pay the rent, and it doesn't decide whether you qualify for the apartment. That decision belongs to the landlord.
It also isn't a letter from your own accountant. It is prepared and signed by an independent licensed CPA, so you don't need to have an accountant already, and you don't need to ask the person who prepared your returns to sign something new.
The 40-times-the-rent rule of thumb
You'll often hear that a landlord wants your annual income to be about 40 times the monthly rent. That is a commonly cited rule of thumb, especially in New York City. It is not a law, and it isn't universal: some landlords use a different multiple, some weigh credit and savings as well, and some set their own requirement building by building.
The arithmetic is simple. At an illustrative rent of $3,000 a month, 40 times the rent is $120,000 a year. For a self-employed applicant, the number a landlord compares against that is usually the income on your tax return, so ask which figure they use. Many look at total income or adjusted gross income, and a business owner's net business income can be well below the revenue the business brings in, because expenses come off first.
That gap is worth knowing before you apply. If your business takes heavy deductions, the income on your return may look smaller than your bank balance suggests. A CPA letter won't change the figures, but it puts the right ones in front of the landlord clearly, so nobody is guessing from deposits.
If your income still falls short
If your documented income doesn't reach the landlord's requirement, a guarantor is the usual next step. A guarantor, often a parent or relative, agrees to cover the rent if you don't, and landlords typically ask the guarantor to document their own income too, sometimes against a higher requirement than the tenant's. There are also companies that act as guarantors for a fee. What a building accepts varies, so ask the leasing office.
Guarantors can use a CPA income letter for the same reason tenants do. If their income comes from self-employment, they face the same missing-pay-stub problem.
What a CPA letter costs
Prices for a CPA letter for an apartment vary, because each accountant sets their own fee and some only write them for existing clients. With us, a CPA income letter is $99 per applicant. Rush is $29 more per applicant and the letter is issued within 6 hours after all documents are in. Without Rush, letters are typically issued within 24 hours of complete documents.
Roommates and co-applicants each get their own letter, and up to four applicants can be on one order. You pay before any work begins, then upload your photo ID and returns through a private link. The clock starts once every document is in, so upload everything at once.
How the landlord can check the letter
A landlord has every reason to wonder whether a letter is genuine, so ours are built to be checked. Every letter carries a unique Letter ID and a QR code. The landlord can look the ID up on our statement and letter lookup page to see who it was issued for, the date, and the signing CPA's name, firm and license number, and to confirm their copy is the original, unaltered file. The lookup never shows your income figures.
Letters are signed by Christopher A. Smith, CPA, of 317 Accounting, PC, Indiana license CP12600077. Anyone can verify the license on the state's public search page by entering that number.
Buying a co-op or condo instead of renting? Boards usually ask for something different: a statement of your assets and debts. Our guide to CPA net worth statements for co-op boards covers what goes in one.
This guide is general information, not legal or tax advice. Check what your landlord requires before you order anything.
Need a CPA letter for your apartment application?
Upload your last two federal returns and a photo ID. A licensed CPA signs a letter stating your income, typically within 24 hours of complete documents.
See how the income letter works →Frequently Asked Questions
How do I prove income for an apartment if I'm self-employed?
Start with your last two federal tax returns (Form 1040 with all schedules), because that is the record most landlords trust for self-employed income. Back them with IRS tax return transcripts, recent bank statements or a year-to-date profit and loss statement, or give the landlord a CPA letter that states the income on your returns on one signed page. Ask the leasing office what it accepts first.
What is a CPA letter for an apartment?
It is a letter signed by a licensed CPA that states the income an applicant reported on their federal tax returns, addressed to the landlord or management company. Ours reports total income, adjusted gross income and, for self-employed applicants, net business income for each of the last two years. It is not an audit or a review.
Does the 40 times the rent rule apply everywhere?
No. Annual income of about 40 times the monthly rent is a commonly cited rule of thumb, especially in New York City, but it is not a law and landlords set their own requirements. Some use a different multiple or weigh credit and savings too, so check with the leasing office.
How much does a CPA income letter cost?
Fees vary by accountant. With AccreditedNow it is $99 per applicant, and Rush is $29 more per applicant (issued within 6 hours of complete documents). Without Rush, letters are typically issued within 24 hours of complete documents. Roommates and co-applicants each get their own letter.
Can a landlord check that a CPA income letter is real?
Ours can be checked. Each letter carries a Letter ID and a QR code the landlord can look up to see who it was issued for, the date and the signing CPA's name, firm and license number, and to confirm the copy is unaltered. The lookup never shows income figures.
More guides: all AccreditedNow guides.