CPA Verification Letter
A CPA verification letter is a formal doc from a Certified Public Accountant (CPA) that confirms your financial situation, including income and self-employment info. It’s an independent analysis of financial documents, like tax returns and bank statements, to verify the accuracy of your financial data. It’s not an audit/review or compilation. Lenders, landlords, and financial institutions often request these letters to evaluate the financial stability and credibility of individuals, especially those who are self-employed or freelance.
What it is:
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- A formal, signed statement from a CPA.
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- An analytical document that analyzes financial records, not just a number provided by the client.
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- A source of credible proof of income for self-employed individuals, contractors, or freelancers.
Why it’s needed:
Mortgage Applications (CPA verification):
Lenders use it to assess a borrower’s ability to repay a mortgage by verifying their income, expenses, and financial health.
Rental Applications:
Landlords use it to ensure self-employed tenants have stable income to cover rent.
Business and Personal Loans:
Financial institutions require it to confirm an individual’s capability to repay loans.
Tax Purposes (CPA verification):
Some individuals may need it to prove income for tax filings or IRS audits.
Immigration/other:
Some visas such as EB2 require a forensic exam associated with the applicant’s income and assertions about being a ‘genius’ or highest caliber/excellence in their field.
What a CPA letter typically includes:
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- Client Information:
Full name, business name (if applicable), address, and contact details.
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- Income Verification:
Details of annual income and income sources over the past two to three years.
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- Financial Review:
An affirmation that the CPA has reviewed the client’s financial documents and tax returns.
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- CPA Credentials:
The CPA’s name, certification, state license number, and contact information.
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- Explanation of Complexities:
If applicable, clear explanations of unique financial circumstances, such as fluctuating income.
Sometimes it will say ‘attached is applicant’s tax return I read (or prepared)’. Or it could say ‘it appears if the information is correct using x amount would not hypothetically affect the business materially, given no other changes. This is subject to lender/3rd party due diligence, and no relationship/liability is created as a result of this letter’.
CONTACT US TO SEND A CPA VERIFICATION LETTER: 415-793-777 mail@hpaccounting.com