my self employed income

[Bill and Eve 1]

My self employed income for my business is well over the 125% poverty level, but it also shows on paper that I lose money the last 2 years. I own my own home and business outright. No mortgages, liens or anything else. If I take in say $30,000 and have no debts will that be viewed differently than someone who makes $21,000 and has monthly rent payments?? My CPA for years, has offered to write a letter that as to my assets but really only have a couple thousand in the bank. This is really starting to bother me so any info or comments appreciated. How can a guy who owns his home and business and has for years be less able to take care of a fiancee than a younger person just starting out??

[YuAndDan 153]

Home can be used as an asset, would need something showing home value, that and income should add up to enough.

Assets are valued at 1/3 income, so for example, if income is short $1000, then $3000 in assets will be needed.

[Casprd 167]

If your business has hard assets and these are solely owned by you then you should be able to use these as assets as well. Owning the home free and clear will go a long way to satisfying the requirements as well.

[JimVaPhuong 4,863]

My self employed income for my business is well over the 125% poverty level, but it also shows on paper that I lose money the last 2 years. I own my own home and business outright. No mortgages, liens or anything else. If I take in say $30,000 and have no debts will that be viewed differently than someone who makes $21,000 and has monthly rent payments?? My CPA for years, has offered to write a letter that as to my assets but really only have a couple thousand in the bank. This is really starting to bother me so any info or comments appreciated. How can a guy who owns his home and business and has for years be less able to take care of a fiancee than a younger person just starting out??

How? Easy! Your tax return shows that your business spends more money than it takes in. What's left over is your personal income, which in your case is a negative number. Somebody "just starting out" as an employee would not have a negative income.

You can declare your home as an asset, but you'll need an appraisal from a license appraiser. An estimate from your accountant won't be good enough.

I suggest you talk with your accountant and tell him you need your line 22 total income on your next 1040 to be above $18,212. He can make adjustments to your schedule C deductions in order to make this happen. This means you'll end up owing some taxes, but you'll qualify to sponsor with your tax return.

[pushbrk 12,898]

How? Easy! Your tax return shows that your business spends more money than it takes in. What's left over is your personal income, which in your case is a negative number. Somebody "just starting out" as an employee would not have a negative income.

You can declare your home as an asset, but you'll need an appraisal from a license appraiser. An estimate from your accountant won't be good enough.

I suggest you talk with your accountant and tell him you need your line 22 total income on your next 1040 to be above $18,212. He can make adjustments to your schedule C deductions in order to make this happen. This means you'll end up owing some taxes, but you'll qualify to sponsor with your tax return.

See bold above. In this context, no matter what you THINK your income is, line 22 on the latest 1040 rules.

You can list your house and document the equity but don't count on the equity being used to offset an income shortfall. Here's the guideline from the i-864 instructions. A Consular officer will make the decision.

Assets may supplement income if the consular or immigrationofficer is convinced that the monetary value of the asset couldreasonably be made available to support the sponsored immigrant and converted to cash within one year without undue harm to the sponsor or his or her family members. Youmay not include an automobile unless you show that you ownat least one working automobile that you have not included.

[Bill and Eve 1]

I'm not disputing that but suppose a guy is just starting out and has rent and car payments, etc.... I have none of those, but as many who own small businesses do, I can depreciate assets and it all shows a wash in the end. I am certainly not being rude to those starting out, but it is many peoples dream to own their own home and business and the tax breaks as such make this process more difficult. Thank you for you help guys and wish me and mine luck please. I worked many years for others to do this and wish I had started this process of K1 then. My 2008 tax shows income of over $60,000 which was my last year of employment before acquiring my present business. Again, thanks for your help!!

[pushbrk 12,898]

I'm not disputing that but suppose a guy is just starting out and has rent and car payments, etc.... I have none of those, but as many who own small businesses do, I can depreciate assets and it all shows a wash in the end. I am certainly not being rude to those starting out, but it is many peoples dream to own their own home and business and the tax breaks as such make this process more difficult. Thank you for you help guys and wish me and mine luck please. I worked many years for others to do this and wish I had started this process of K1 then. My 2008 tax shows income of over $60,000 which was my last year of employment before acquiring my present business. Again, thanks for your help!!

Many of us are self employed as well, including me. It's a two-edged sword when it comes to immigration. Consular officers will consider liquid assets under the guidelines I quoted you. The are unlikely to believe you'll sell your primary residence to support your spouse unless you have another home to live it. Think of it the same way as how they describe using a car as an asset, only if you have another one. If you have OTHER "liquid" assets to state and document, that's another matter.

As for your "suppose a guy i just starting out...." they don't care. They have their guidelines and that's the way it works. WE know, for instance that a 50 year old who owns his home free and clear and has no debt is far better prepared to support his wife on $17,000 a year than the 25 year old paying rent and car payments is on $25,000 a year, and so does the Consular officer but they MUST see that you meet the minimums.

Certainly, you have the option of using your 2010 income from line 22 of your 2010 tax return. I expect you can file that return showing enough income. If you forget some deductions and need to file an amended return later, nothing is stopping you.

[JimVaPhuong 4,863]

I'm not disputing that but suppose a guy is just starting out and has rent and car payments, etc.... I have none of those, but as many who own small businesses do, I can depreciate assets and it all shows a wash in the end. I am certainly not being rude to those starting out, but it is many peoples dream to own their own home and business and the tax breaks as such make this process more difficult. Thank you for you help guys and wish me and mine luck please. I worked many years for others to do this and wish I had started this process of K1 then. My 2008 tax shows income of over $60,000 which was my last year of employment before acquiring my present business. Again, thanks for your help!!

Ok, a consular officer is allowed to take someones debts into account IF they know about them. They wouldn't generally know how much someone pays for rent or car payments or any other personal debts. On the other hand, if someone was being sued by a hospital for $100,000 worth of medical expenses, and they were still being treated for the same illness, then a consular officer might find out about this through a standard Lexis Nexis background check, and they probably would take it into account. There's a whole chapter in the Foreign Affairs Manual about this stuff.

There are some presumptions that they make. First, they presume that line 22 on your federal income tax return is an accurate reflection of your personal income - the amount of money you have to live on after your business expenses have been deducted. They also presume that pretty much everyone has typical living expenses - rent or mortgage, transportation costs, food and clothing, etc. These things are factored into the poverty guideline numbers. In fact, it's the average cost of these things that determine what the poverty guidelines numbers are for a given year.

The federal government is extremely gracious to small business owners by allowing them to deduct expenses that may only be marginally related to their business, and often are much more than they actually spend. The government is trying to help you succeed by giving you a chance to lessen your personal tax burden. Someone working for an employer doesn't get all of those cool business deductions, so they have to pay a lot more in taxes. It isn't fair for you to expect the IRS to consider your personal income to be very low for the purpose of taxes while simultaneously expecting the Department of State to consider your income to be much higher for the purpose of sponsoring an immigrant. The consulate is going to look at line 22 on your 1040. If you want that number to be higher then bite the bullet, take fewer business deductions, and pay the resulting taxes.