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Determining Cash Flow from Personal Tax Returns Part 2: Schedules D, E & F

Mar 04 2:00 PM - Mar 04, 2021 3:30 PM
Mar 04, 2021 2:00 PM - 3:30 PM
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Learn to discern the elusive cash flow from Schedules D, E and F of borrowers’ personal tax returns. The method taught in this program is easy and reliable. From asset sales, to rental properties, to partnerships and farms, you’ll be able to accurately assess the borrower’s cash flow.

Learning Objectives

  • Understand recurring versus non-recurring incomes or losses from sales of assets on Schedule D or Form 4797
  • Cash flow Schedule E, Page 1 to find the real income or loss from rental and royalty properties
  • Build a “fair” cash flow for a rental property to assist in making a safe loan
  • Convert Schedule E, Page 2: Partnerships and S Corporations from phantom incomes to real cash flow
  • Correct farmers’ income on Schedule F: Farm Income

Determining cash flow from personal income tax returns is as important and challenging as ever. What does a lender need from a personal tax return? The cash flow that can repay your loan. With the information from this session, along with the free Lenders Tax Analyzer© software included with your registration, you will learn an easy, reliable method to convert a borrower’s personal tax return to an accurate cash flow statement. Part 2 of this two-part program will cover some of the most difficult income to analyze.

  • Are the sales of assets reported on Schedule D or Form 4797 recurring?
  • Rental properties can be evaluated two ways, but one is often too conservative resulting in unnecessary denials.
  • Partnerships and S corps show pass-through incomes that matter to the IRS, but nothing when determining cash flow.
  • Farms often report income that was only partially taxable, or income from a different tax year.

Note: This session is designed for consumer and commercial lenders. This method does not follow Fannie, Freddie, or QM rules used in mortgage lending.



Tim Harrington, TEAM Resources

Tim Harrington is President of TEAM Resources and has been a financial institution consultant for over 28 years. Tim has advised lenders on verifying income from tax returns since 1992, and consults with financial institutions nationwide on issues of strategy, profitability, and board governance. He speaks at nationwide conferences and has presented in Canada, Mexico, Puerto Rico, Jamaica, and the Virgin Islands. Tim is the author of the popular software, Lenders Tax Analyzer. In addition, his book “Eisenhower on Enlightened Leadership” has been used by management teams nationwide to improve leadership skills. He did his undergraduate studies at Gonzaga University and graduate studies at the University of Washington. 




Additional Info

Event Type

On-Demand Webinar

Topics Covered

  • On-Demand Webinars
  • Operations
  • Lending & Collections
  • Executive Management