{
  "schema_version": 1,
  "dataset_id": "self-employed-income-worked-examples-2026",
  "title": "2026 Self-Employed Mortgage Income Worked Examples",
  "description": "Three hypothetical, source-mapped examples showing selected Fannie Mae cash-flow mechanics for Schedule C, S-corporation and K-1 income, and a multi-entity roll-up.",
  "version": "2026.1",
  "published_date": "2026-09-02",
  "source_reviewed_date": "2026-09-02",
  "example_count": 3,
  "record_count": 13,
  "scope": "Educational examples of selected Fannie Mae self-employment income screens. This dataset is not a complete Form 1084, an automated income calculator, or a substitute for a lender's borrower-specific written analysis.",
  "disclaimer": "These hypothetical examples are not an approval, commitment to lend, rate quote, or calculation of any borrower's actual qualifying income. Current agency requirements, lender overlays, source documents, income history and trend, business liquidity, continuance, and the lender's completed written analysis control the actual file.",
  "methodology": "Kellibrooke translated selected Fannie Mae guidance into bounded examples, retained unresolved underwriting questions as unresolved, mapped every line item to a reviewed primary source, and independently validates the published arithmetic and page-to-download parity.",
  "landing_page_url": "https://kellibrooke.com/how-mortgage-lenders-calculate-self-employed-income-austin/",
  "correction_policy_url": "https://kellibrooke.com/editorial-standards/",
  "license": {
    "name": "Creative Commons Attribution 4.0 International",
    "url": "https://creativecommons.org/licenses/by/4.0/",
    "applies_to": "Kellibrooke's original compilation, example facts, and wording only. Linked Fannie Mae source material retains its own terms."
  },
  "fields": {
    "amount_usd": "Hypothetical amount for the line item in the stated amount_period",
    "operation": "How the line item is treated in this bounded illustration: add, subtract, review, or evidence-only",
    "included_in_illustrated_result": "Whether the line item is used in the example's arithmetic result",
    "treatment": "Why the example adds, subtracts, reviews, or excludes the line item",
    "source_ids": "Primary-source identifiers mapped to the individual line item",
    "illustrated_result_usd": "The bounded example result; not actual qualifying income",
    "monthly_equivalent_usd": "Monthly equivalent of the bounded example result",
    "calculation_status": "The unresolved limits on the illustrated result"
  },
  "sources": [
    {
      "id": "fannie-self-employed-analysis",
      "publisher": "Fannie Mae",
      "title": "B3-3.5-01, Underwriting Factors and Documentation for a Self-Employed Borrower",
      "source_version": "2023-12-13",
      "reviewed": "2026-09-02",
      "url": "https://selling-guide.fanniemae.com/sel/b3-3.5-01/underwriting-factors-and-documentation-self-employed-borrower"
    },
    {
      "id": "fannie-schedule-c",
      "publisher": "Fannie Mae",
      "title": "B3-3.6-03, Income or Loss Reported on IRS Form 1040, Schedule C",
      "source_version": "2009-04-01",
      "reviewed": "2026-09-02",
      "url": "https://selling-guide.fanniemae.com/sel/b3-3.6-03/income-or-loss-reported-irs-form-1040-schedule-c"
    },
    {
      "id": "fannie-schedule-k1",
      "publisher": "Fannie Mae",
      "title": "B3-3.6-07, Income or Loss Reported on IRS Form 1065 or IRS Form 1120S, Schedule K-1",
      "source_version": "2025-05-07",
      "reviewed": "2026-09-02",
      "url": "https://selling-guide.fanniemae.com/sel/b3-3.6-07/income-or-loss-reported-irs-form-1065-or-irs-form-1120s-schedule-k-1"
    },
    {
      "id": "fannie-form-1084",
      "publisher": "Fannie Mae",
      "title": "Cash Flow Analysis, Form 1084",
      "source_version": "2019-06",
      "reviewed": "2026-09-02",
      "url": "https://singlefamily.fanniemae.com/media/document/pdf/form-1084"
    }
  ],
  "examples": [
    {
      "id": "schedule-c-adjustment",
      "title": "Schedule C adjustment example",
      "scope": "A simplified annual Schedule C screen using selected recurring and nonrecurring adjustments identified in Fannie Mae guidance.",
      "source_ids": [
        "fannie-schedule-c",
        "fannie-form-1084"
      ],
      "items": [
        {
          "sequence": 1,
          "item": "Schedule C net profit",
          "amount_period": "annual",
          "amount_usd": 96000,
          "operation": "add",
          "included_in_illustrated_result": true,
          "source_ids": [
            "fannie-schedule-c",
            "fannie-form-1084"
          ],
          "treatment": "Starting net profit shown on Schedule C."
        },
        {
          "sequence": 2,
          "item": "Recurring depreciation",
          "amount_period": "annual",
          "amount_usd": 12000,
          "operation": "add",
          "included_in_illustrated_result": true,
          "source_ids": [
            "fannie-schedule-c",
            "fannie-form-1084"
          ],
          "treatment": "Added back as a supported Schedule C depreciation expense in this example; the return must support the amount and treatment."
        },
        {
          "sequence": 3,
          "item": "Business use of home",
          "amount_period": "annual",
          "amount_usd": 3600,
          "operation": "add",
          "included_in_illustrated_result": true,
          "source_ids": [
            "fannie-schedule-c",
            "fannie-form-1084"
          ],
          "treatment": "Added back as a supported Schedule C business-use-of-home expense."
        },
        {
          "sequence": 4,
          "item": "Amortization",
          "amount_period": "annual",
          "amount_usd": 2400,
          "operation": "add",
          "included_in_illustrated_result": true,
          "source_ids": [
            "fannie-schedule-c",
            "fannie-form-1084"
          ],
          "treatment": "Added back as a supported Schedule C amortization expense."
        },
        {
          "sequence": 5,
          "item": "Nonrecurring income",
          "amount_period": "annual",
          "amount_usd": 6000,
          "operation": "subtract",
          "included_in_illustrated_result": true,
          "source_ids": [
            "fannie-schedule-c",
            "fannie-form-1084"
          ],
          "treatment": "Deducted because the example assumes the income is nonrecurring."
        }
      ],
      "result": {
        "period": "annual",
        "amount_usd": 108000,
        "monthly_equivalent_usd": 9000,
        "calculation": "96000 + 12000 + 3600 + 2400 - 6000 = 108000; 108000 / 12 = 9000",
        "status": "Illustrated Schedule C screen only; not a complete income analysis."
      },
      "guardrail": "The return must support each item and whether it is recurring or nonrecurring."
    },
    {
      "id": "s-corporation-k1-liquidity",
      "title": "S-corporation W-2, K-1, and liquidity example",
      "scope": "A bounded screen showing why shareholder W-2 wages, K-1 ordinary income, and cash distributions are not automatically added together.",
      "source_ids": [
        "fannie-self-employed-analysis",
        "fannie-schedule-k1",
        "fannie-form-1084"
      ],
      "items": [
        {
          "sequence": 1,
          "item": "Shareholder W-2 wages",
          "amount_period": "annual",
          "amount_usd": 120000,
          "operation": "add",
          "included_in_illustrated_result": true,
          "source_ids": [
            "fannie-self-employed-analysis",
            "fannie-form-1084"
          ],
          "treatment": "Shown separately as $10,000 monthly if the wages and continuance are supported."
        },
        {
          "sequence": 2,
          "item": "Schedule K-1 ordinary income",
          "amount_period": "annual",
          "amount_usd": 80000,
          "operation": "review",
          "included_in_illustrated_result": false,
          "source_ids": [
            "fannie-self-employed-analysis",
            "fannie-schedule-k1"
          ],
          "treatment": "Not automatically included; distribution history, continued access, ownership, business liquidity, and the completed cash-flow analysis must support any usable amount."
        },
        {
          "sequence": 3,
          "item": "Cash distributions",
          "amount_period": "annual",
          "amount_usd": 30000,
          "operation": "evidence-only",
          "included_in_illustrated_result": false,
          "source_ids": [
            "fannie-self-employed-analysis",
            "fannie-schedule-k1"
          ],
          "treatment": "Reviewed as evidence of access to earnings and not added again as a separate income source."
        }
      ],
      "result": {
        "period": "monthly",
        "amount_usd": 10000,
        "monthly_equivalent_usd": 10000,
        "calculation": "120000 / 12 = 10000; no K-1 or distribution amount is added in this bounded screen",
        "status": "Only the separately supported W-2 amount is illustrated; additional K-1 income remains unresolved."
      },
      "guardrail": "This example does not conclude that the W-2 is eligible or that the K-1 income is unusable in an actual file."
    },
    {
      "id": "multi-entity-roll-up",
      "title": "Multi-entity roll-up and double-count check",
      "scope": "A monthly roll-up after each business and income source has already received its own acceptable analysis.",
      "source_ids": [
        "fannie-self-employed-analysis",
        "fannie-schedule-c",
        "fannie-schedule-k1",
        "fannie-form-1084"
      ],
      "items": [
        {
          "sequence": 1,
          "item": "Completed Schedule C screen",
          "amount_period": "monthly",
          "amount_usd": 9000,
          "operation": "add",
          "included_in_illustrated_result": true,
          "source_ids": [
            "fannie-self-employed-analysis",
            "fannie-schedule-c",
            "fannie-form-1084"
          ],
          "treatment": "Included after a separate acceptable Schedule C analysis."
        },
        {
          "sequence": 2,
          "item": "Supported S-corporation W-2 wages",
          "amount_period": "monthly",
          "amount_usd": 10000,
          "operation": "add",
          "included_in_illustrated_result": true,
          "source_ids": [
            "fannie-self-employed-analysis",
            "fannie-form-1084"
          ],
          "treatment": "Included after separate documentation and continuance review."
        },
        {
          "sequence": 3,
          "item": "Separately supportable K-1 income",
          "amount_period": "monthly",
          "amount_usd": 2500,
          "operation": "add",
          "included_in_illustrated_result": true,
          "source_ids": [
            "fannie-self-employed-analysis",
            "fannie-schedule-k1"
          ],
          "treatment": "Included only because the example assumes the required access and liquidity analysis supports this amount."
        },
        {
          "sequence": 4,
          "item": "Partnership loss",
          "amount_period": "monthly",
          "amount_usd": 1000,
          "operation": "subtract",
          "included_in_illustrated_result": true,
          "source_ids": [
            "fannie-self-employed-analysis",
            "fannie-schedule-k1",
            "fannie-form-1084"
          ],
          "treatment": "Subtracted after the partnership analysis produces a supported monthly loss."
        },
        {
          "sequence": 5,
          "item": "Cash distributions used as access evidence",
          "amount_period": "monthly",
          "amount_usd": 0,
          "operation": "evidence-only",
          "included_in_illustrated_result": false,
          "source_ids": [
            "fannie-self-employed-analysis",
            "fannie-schedule-k1"
          ],
          "treatment": "Not added again because doing so would double count the earnings they help document."
        }
      ],
      "result": {
        "period": "monthly",
        "amount_usd": 20500,
        "monthly_equivalent_usd": 20500,
        "calculation": "9000 + 10000 + 2500 - 1000 = 20500",
        "status": "Illustrated roll-up after separate source-level analyses; not a complete borrower calculation."
      },
      "guardrail": "Each entity still needs acceptable history, trend, current activity, documentation, liquidity where applicable, and continuance."
    }
  ],
  "rows": [
    {
      "example_id": "schedule-c-adjustment",
      "example_title": "Schedule C adjustment example",
      "sequence": 1,
      "item": "Schedule C net profit",
      "amount_period": "annual",
      "amount_usd": 96000,
      "operation": "add",
      "included_in_illustrated_result": true,
      "treatment": "Starting net profit shown on Schedule C.",
      "source_ids": "fannie-schedule-c|fannie-form-1084",
      "illustrated_result_period": "annual",
      "illustrated_result_usd": 108000,
      "monthly_equivalent_usd": 9000,
      "calculation_status": "Illustrated Schedule C screen only; not a complete income analysis.",
      "source_reviewed_date": "2026-09-02",
      "dataset_version": "2026.1"
    },
    {
      "example_id": "schedule-c-adjustment",
      "example_title": "Schedule C adjustment example",
      "sequence": 2,
      "item": "Recurring depreciation",
      "amount_period": "annual",
      "amount_usd": 12000,
      "operation": "add",
      "included_in_illustrated_result": true,
      "treatment": "Added back as a supported Schedule C depreciation expense in this example; the return must support the amount and treatment.",
      "source_ids": "fannie-schedule-c|fannie-form-1084",
      "illustrated_result_period": "annual",
      "illustrated_result_usd": 108000,
      "monthly_equivalent_usd": 9000,
      "calculation_status": "Illustrated Schedule C screen only; not a complete income analysis.",
      "source_reviewed_date": "2026-09-02",
      "dataset_version": "2026.1"
    },
    {
      "example_id": "schedule-c-adjustment",
      "example_title": "Schedule C adjustment example",
      "sequence": 3,
      "item": "Business use of home",
      "amount_period": "annual",
      "amount_usd": 3600,
      "operation": "add",
      "included_in_illustrated_result": true,
      "treatment": "Added back as a supported Schedule C business-use-of-home expense.",
      "source_ids": "fannie-schedule-c|fannie-form-1084",
      "illustrated_result_period": "annual",
      "illustrated_result_usd": 108000,
      "monthly_equivalent_usd": 9000,
      "calculation_status": "Illustrated Schedule C screen only; not a complete income analysis.",
      "source_reviewed_date": "2026-09-02",
      "dataset_version": "2026.1"
    },
    {
      "example_id": "schedule-c-adjustment",
      "example_title": "Schedule C adjustment example",
      "sequence": 4,
      "item": "Amortization",
      "amount_period": "annual",
      "amount_usd": 2400,
      "operation": "add",
      "included_in_illustrated_result": true,
      "treatment": "Added back as a supported Schedule C amortization expense.",
      "source_ids": "fannie-schedule-c|fannie-form-1084",
      "illustrated_result_period": "annual",
      "illustrated_result_usd": 108000,
      "monthly_equivalent_usd": 9000,
      "calculation_status": "Illustrated Schedule C screen only; not a complete income analysis.",
      "source_reviewed_date": "2026-09-02",
      "dataset_version": "2026.1"
    },
    {
      "example_id": "schedule-c-adjustment",
      "example_title": "Schedule C adjustment example",
      "sequence": 5,
      "item": "Nonrecurring income",
      "amount_period": "annual",
      "amount_usd": 6000,
      "operation": "subtract",
      "included_in_illustrated_result": true,
      "treatment": "Deducted because the example assumes the income is nonrecurring.",
      "source_ids": "fannie-schedule-c|fannie-form-1084",
      "illustrated_result_period": "annual",
      "illustrated_result_usd": 108000,
      "monthly_equivalent_usd": 9000,
      "calculation_status": "Illustrated Schedule C screen only; not a complete income analysis.",
      "source_reviewed_date": "2026-09-02",
      "dataset_version": "2026.1"
    },
    {
      "example_id": "s-corporation-k1-liquidity",
      "example_title": "S-corporation W-2, K-1, and liquidity example",
      "sequence": 1,
      "item": "Shareholder W-2 wages",
      "amount_period": "annual",
      "amount_usd": 120000,
      "operation": "add",
      "included_in_illustrated_result": true,
      "treatment": "Shown separately as $10,000 monthly if the wages and continuance are supported.",
      "source_ids": "fannie-self-employed-analysis|fannie-form-1084",
      "illustrated_result_period": "monthly",
      "illustrated_result_usd": 10000,
      "monthly_equivalent_usd": 10000,
      "calculation_status": "Only the separately supported W-2 amount is illustrated; additional K-1 income remains unresolved.",
      "source_reviewed_date": "2026-09-02",
      "dataset_version": "2026.1"
    },
    {
      "example_id": "s-corporation-k1-liquidity",
      "example_title": "S-corporation W-2, K-1, and liquidity example",
      "sequence": 2,
      "item": "Schedule K-1 ordinary income",
      "amount_period": "annual",
      "amount_usd": 80000,
      "operation": "review",
      "included_in_illustrated_result": false,
      "treatment": "Not automatically included; distribution history, continued access, ownership, business liquidity, and the completed cash-flow analysis must support any usable amount.",
      "source_ids": "fannie-self-employed-analysis|fannie-schedule-k1",
      "illustrated_result_period": "monthly",
      "illustrated_result_usd": 10000,
      "monthly_equivalent_usd": 10000,
      "calculation_status": "Only the separately supported W-2 amount is illustrated; additional K-1 income remains unresolved.",
      "source_reviewed_date": "2026-09-02",
      "dataset_version": "2026.1"
    },
    {
      "example_id": "s-corporation-k1-liquidity",
      "example_title": "S-corporation W-2, K-1, and liquidity example",
      "sequence": 3,
      "item": "Cash distributions",
      "amount_period": "annual",
      "amount_usd": 30000,
      "operation": "evidence-only",
      "included_in_illustrated_result": false,
      "treatment": "Reviewed as evidence of access to earnings and not added again as a separate income source.",
      "source_ids": "fannie-self-employed-analysis|fannie-schedule-k1",
      "illustrated_result_period": "monthly",
      "illustrated_result_usd": 10000,
      "monthly_equivalent_usd": 10000,
      "calculation_status": "Only the separately supported W-2 amount is illustrated; additional K-1 income remains unresolved.",
      "source_reviewed_date": "2026-09-02",
      "dataset_version": "2026.1"
    },
    {
      "example_id": "multi-entity-roll-up",
      "example_title": "Multi-entity roll-up and double-count check",
      "sequence": 1,
      "item": "Completed Schedule C screen",
      "amount_period": "monthly",
      "amount_usd": 9000,
      "operation": "add",
      "included_in_illustrated_result": true,
      "treatment": "Included after a separate acceptable Schedule C analysis.",
      "source_ids": "fannie-self-employed-analysis|fannie-schedule-c|fannie-form-1084",
      "illustrated_result_period": "monthly",
      "illustrated_result_usd": 20500,
      "monthly_equivalent_usd": 20500,
      "calculation_status": "Illustrated roll-up after separate source-level analyses; not a complete borrower calculation.",
      "source_reviewed_date": "2026-09-02",
      "dataset_version": "2026.1"
    },
    {
      "example_id": "multi-entity-roll-up",
      "example_title": "Multi-entity roll-up and double-count check",
      "sequence": 2,
      "item": "Supported S-corporation W-2 wages",
      "amount_period": "monthly",
      "amount_usd": 10000,
      "operation": "add",
      "included_in_illustrated_result": true,
      "treatment": "Included after separate documentation and continuance review.",
      "source_ids": "fannie-self-employed-analysis|fannie-form-1084",
      "illustrated_result_period": "monthly",
      "illustrated_result_usd": 20500,
      "monthly_equivalent_usd": 20500,
      "calculation_status": "Illustrated roll-up after separate source-level analyses; not a complete borrower calculation.",
      "source_reviewed_date": "2026-09-02",
      "dataset_version": "2026.1"
    },
    {
      "example_id": "multi-entity-roll-up",
      "example_title": "Multi-entity roll-up and double-count check",
      "sequence": 3,
      "item": "Separately supportable K-1 income",
      "amount_period": "monthly",
      "amount_usd": 2500,
      "operation": "add",
      "included_in_illustrated_result": true,
      "treatment": "Included only because the example assumes the required access and liquidity analysis supports this amount.",
      "source_ids": "fannie-self-employed-analysis|fannie-schedule-k1",
      "illustrated_result_period": "monthly",
      "illustrated_result_usd": 20500,
      "monthly_equivalent_usd": 20500,
      "calculation_status": "Illustrated roll-up after separate source-level analyses; not a complete borrower calculation.",
      "source_reviewed_date": "2026-09-02",
      "dataset_version": "2026.1"
    },
    {
      "example_id": "multi-entity-roll-up",
      "example_title": "Multi-entity roll-up and double-count check",
      "sequence": 4,
      "item": "Partnership loss",
      "amount_period": "monthly",
      "amount_usd": 1000,
      "operation": "subtract",
      "included_in_illustrated_result": true,
      "treatment": "Subtracted after the partnership analysis produces a supported monthly loss.",
      "source_ids": "fannie-self-employed-analysis|fannie-schedule-k1|fannie-form-1084",
      "illustrated_result_period": "monthly",
      "illustrated_result_usd": 20500,
      "monthly_equivalent_usd": 20500,
      "calculation_status": "Illustrated roll-up after separate source-level analyses; not a complete borrower calculation.",
      "source_reviewed_date": "2026-09-02",
      "dataset_version": "2026.1"
    },
    {
      "example_id": "multi-entity-roll-up",
      "example_title": "Multi-entity roll-up and double-count check",
      "sequence": 5,
      "item": "Cash distributions used as access evidence",
      "amount_period": "monthly",
      "amount_usd": 0,
      "operation": "evidence-only",
      "included_in_illustrated_result": false,
      "treatment": "Not added again because doing so would double count the earnings they help document.",
      "source_ids": "fannie-self-employed-analysis|fannie-schedule-k1",
      "illustrated_result_period": "monthly",
      "illustrated_result_usd": 20500,
      "monthly_equivalent_usd": 20500,
      "calculation_status": "Illustrated roll-up after separate source-level analyses; not a complete borrower calculation.",
      "source_reviewed_date": "2026-09-02",
      "dataset_version": "2026.1"
    }
  ]
}