How to Read Tax Returns and Close More Loans to Read Tax Returns and Close More Loans Presented by...

transcript

How to Read Tax Returns and

Close More Loans

Presented by David Kuiper

MBA, CMA, CMPS

About David Kuiper

David started in mortgage banking in 1990. He graduated from

Hope College in 1988 with degrees in Pre-Med Physiology and

Business Administration. He also holds an MBA in finance from Grand

Valley State University and is a Certified Mortgage Planning Specialist

• Rated as one of the top mortgage loan officers in the

country

• Closed over 5500 loans totaling in excess of $900,000,000

• Nationally recognized author, speaker and trainer

• Teaching faculty of Loan Toolbox and Mortgage Planner

University.

• Expert on First Impressions and Building Client Intimacy.

• David, his wife Michelle, five children, two cats and a dog

live in Holland MI and Fort Myers FL.

Today’s Seminar Will:

Give you an overview of how to read tax

returns & understand why

Learn how to find “hidden” cash flow in

tax returns & write more loans

Narrative and forms for downloading

When are tax returns needed?

1. A borrower is considered self-employed when they own 25% or more interest in a business. This is when the taxes would be required to calculate the borrower’s income.

2. When 25% or more of the income is from other than base salary. Examples of this are if the borrower’s income comes 25% or more from overtime, bonuses, commissions or piecework.

3. Tax Returns are necessary if the borrower works for a

family-owned business.

4. If the borrower has rental income, analyzing the tax return will determine if there is net income or loss from the rental income.

Different types of self employed borrowers:

Sole Proprietorship – A business owned by one person. The individual

owner is personally liable for all debts of the business and therefore has

unlimited liability. Income or loss is reported on Schedule C, Form 1040, the

individual tax return.

Partnership – When two or more individuals form a business. The partners share profits and categories, General Partnership and Limited Partnerships.

General Partnership – Each partner is personally liable for the debts of the

whole business; however, business creditors are required to attach business

assets first. Personal creditors cannot access partnership assets.

S Corporation – Generally, a small, start-up business that is taxed in the same

manner as a partnership.

Corporation – A state-chartered business owned by stockholders, wherein the

stockholder is not personally responsible for the debts of the corporation. The

profits (retained earnings) are put back into the business, or are distributed to

stockholders as dividends. Corporations report their income and losses on the

U.S. Corporation Income Tax Return, Form 1120.

Cash Flow Analysis Worksheet

david kuiper mortgage team

Form 1040

Personal Individual

Tax Return

Form 1040

(Page 2)

Personal Individual

Tax Return

Schedule A

Itemized

Deductions

Schedule A

(Page 2)

Schedule B

Interest &

Ordinary Dividends

Form 2106

Employee Business

Expenses

(Page 2)

Form 2106

Employee Business

Expenses

Schedule C

Profit or Loss

from Business

Schedule C

(Page 2)

Profit or Loss

from Business

Form 4562

Depreciation &

Amortization

Form 4562

(Page 2)

Depreciation &

Ammortization

Schedule D

Capital Gains

& Losses

Schedule D

(Page 2)

Capital Gains

& Losses

Form 6252

Installment

Sale Income

Instructions for

Form 6252

Installment

Sale Income

Instructions for

Form 6252

Installment

Sale Income

Instructions for

Form 6252

Installment

Sale Income

Form 4797

Sales of

Business Property

Form 4797

(Page 2)

Sales of

Business Property

Schedule E

Supplemental

Income & Loss

Schedule E

(Page 2)

Supplemental

Income & Loss

Form 8582

Passive Activity

Loss Limitations

Form 8582

(Instructions)

Passive Activity

Loss Limitations

Form 8582

(Instructions)

Passive Activity

Loss Limitations

Schedule F

Profit or Loss

from Farming

Schedule F

(Page 2)

Profit or Loss

from Farming

Form 1065

Return of

Partnership Income

Form 1065

(Page 2)

Return of

Partnership Income

Form 1065

(Page 3)

Return of

Partnership Income

Form 1065

(Page 4)

Return of

Partnership Income

Form 1065

(Page 5)

Return of

Partnership Income

Scheule K-1 of

Form 1065

Partner’s Share of

Income,

Deductions,

Credits, etc.

Scheule K-1 of

Form 1065

(Page 2)

Partner’s Share of

Income,

Deductions,

Credits, etc.

Form 1120S

Income Tax Return

for an S Corporation

Form 1120S

(Page 2)

Income Tax Return

Form 1120S

(Page 3)

Income Tax Return

Form 1120S

(Page 4)

Income Tax Return

Schedule K-1 of

Form 1120S

Shareholder’s

Share of Income,

Deductions, Credits,

Form 1120

U.S. Corporation

Income Tax Returns

Form 1120

(Page 2)

U.S. Corporation

Income Tax Returns

Form 1120

(Page 3)

U.S. Corporation

Income Tax Returns

Form 1120

(Page 4)

U.S. Corporation

Income Tax Returns

Form 1120

(Page 5)

U.S. Corporation

Income Tax Returns

Now you know…

Depreciation

Depletion

Amortization

Business Use in Home

Depreciation from mileage

Cash Flow Analysis

(Page 2)

Cash Flow Analysis

(Narrative)

Cash Flow Analysis

(Narrative)

Cash Flow Analysis

(Narrative)

Downloads available with this

course…(downloads available on the original page where you accessed

this class)

Narrative of Cash Flow Analysis

Copies of Tax Returns, Schedules, with comments

Test Yourself…

Find old file/self-employed

Work thru Tax Returns

Did you get the same income as the Underwriter?

Sample Script…

“I’m an expert in analyzing tax returns. Before

we make the judgment that you don’t have

enough income, or that business was not so

great, let me take a look at your tax returns. We

can then make the best recommendations for

you.”

Tips…

Ask for “complete” tax returns

Go directly to CPA or Financial Planner

Email to you

Stop by and introduce yourself

Become a

“Self-Employed” Expert

Higher loan balances

Working relations with processor/UW

Connect with CPA/Financial Planner

Find more income

Save deals for your real estate agents

More referrals

Tax Return Extensions

Last 2 year’s tax returns

Current profit & loss statements

FHA – Also most recent quarterly

statement

In Closing (no pun intended)

Highlight income you can use

Transfer to Cash Flow Analysis Form

Leave Taxes with you to review

How to Read Tax Returns Class Brought to you by:

www.MortgageCurrentcy.com

Questions?

David Kuiper Certified Mortgage Planning Specialist

616.546.9250 Direct

david@davidkuiper.com

How to Read Tax Returns and Close More Loans to Read Tax Returns and Close More Loans Presented by...

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