B1-1-03, Allowable Age of Credit Documents and Federal Income Tax Returns (05/03/2023)

This topic contains information on the allowable age of credit documents and federal income tax returns.

Allowable Age of Credit Documents

Credit documents include credit reports and employment, income, and asset documentation. For all mortgage loans (existing and new construction), the credit documents must be no more than four months old on the note date. When consecutive credit documents are in the loan file, the most recent document is used to determine whether it meets the age requirement. For example, when two consecutive monthly bank statements are used to verify a depository asset, the date of the most recent statement must be no more than four months old on the note date. If the credit documents are older than allowed, the lender must update them. For age requirements related to appraisals, see B4-1.2-04, Appraisal Age and Use RequirementsB4-1.2-04, Appraisal Age and Use Requirements . Also see B2-3-05, Properties Affected by a DisasterB2-3-05, Properties Affected by a Disaster for exceptions to the allowable age of credit documents for loans impacted by a natural disaster.

Allowable Age of Federal Income Tax Returns

For some types of sources of income, Fannie Mae requires lenders to obtain copies of federal income tax returns (personal returns and, if applicable, business returns). The “most recent year’s” tax return is defined as the last return scheduled to have been filed with the IRS. For example,

If Today’s Date is. Then the Most Recent Year’s Tax Return would be.
February 15, 2023 2021
April 16, 2023 2022
December 15, 2023 2022

The following table describes the requirements for documenting the most recent year's tax return based on the application date and disbursement date of the loan. The loan file must always include the last tax return filed by the borrower and the minimum number of years of tax returns required by B3-3.5-01, Income and Employment Documentation for DUB3-3.5-01, Income and Employment Documentation for DU or as noted in various sections of the Selling Guide for manually underwritten loans.

The most recent year’s tax return is recommended; however, the previous year(s) is also acceptable.

In the event the most recent year's tax return is not obtained, the loan file must include a completed and signed IRS Form 4506-C for transcripts of tax returns provided by the borrower to the lender.

The most recent year’s tax return is recommended; however, the previous year(s) is also acceptable.

In the event the most recent year's tax return is not obtained, the lender must perform all of the following: