The lender must obtain copies of the borrower’s signed federal income tax returns filed with the IRS for the past two years if the borrower is employed by family members.
If a borrower’s income is validated by the DU validation service, lenders are not required to determine if the borrower is employed by a family member or interested party to the property sale or purchase. See B3-2-02, DU Validation Service for additional information.
For more information, see B3-3.1-01, General Income Information.