I also have gotten several inquiries like this one My credit card company is asking for my current income citing "Federal Regulations" which started me wondering just what is considered 'income'.

I do realize my circumstances aren't exactly the norm, as I haven't had significant W2 income for a decade or more. I do part-time contracting/consulting work, and in an average year might net $25-30K or so. (I spend maybe $20K, so that's fine.) I have investments that (again on average) appreciate rather more than that, but since they're not actively traded, and a lot of them are in IRAs, that growth never appears on tax forms. So what does the credit card company consider my income to be: the $25K that shows up on my 1040, or the annual increase in my net worth?


You can answer what ever you feel comfortable with.

They have access to your credit report/score. They don't have access to your current income. They can't verify what you put down regarding your current income, unless they ask for copies of tax records.

What you are doing is giving them a new, more recent, data point. When you applied for the card X years ago you told them what you made, you probably also told them what you spent on housing, and other loans you had. They can see your other cards, they can see your other loans. But if you rent they don't know how much you pay per month. They also don't know how much is your income. When you give them this income they can decide to increase your limit, or decide not to increase your limit.

I have never consulted my most recent pay stub, or tax form. I just expressed my best guess income in whatever time period they asked (monthly or yearly). I don't include my investment income because most of it is in retirement accounts. As to consulting just give them your best guess.

  • Makes sense... but then I wonder why they bother to ask about income, if it's not verifiable? – jamesqf Jan 18 '15 at 18:09
  • The law requires them to consider ability to pay when determining how much credit to issue. One of the simplest models for measuring ability to pay is to look at income and expenses. So they ask you about these things, to cover their own rear in case you default. – Joe Sniderman Jan 19 '15 at 15:46

Generally, they will use the same definition the IRS uses -- if you give them adjusted gross income off your tax forms, they'll be happy.

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