Does conventional require tax returns?
For self-employed and 1099 income, yes — typically two years of personal and business returns. For salaried W-2 borrowers, conventional often runs without tax returns when automated underwriting waives them, though lender overlays may still ask.
Plain-English explanation
Fannie Mae's DU often issues 'tax-transcript-not-required' findings on clean W-2 files, and many lenders accept that result. Self-employed borrowers always document with returns plus business returns where applicable. The 4506-C IRS transcript request is signed at application; the lender pulls transcripts to confirm income reporting matches what's on file.
What can change the answer?
Documentation type, employment stability, year-over-year trends, and any recent job/business changes can change the answer.
Want the real answer for your conventional file?
Conventional guidelines are the rule. Your credit, income, DTI, PMI, LLPAs, and Florida payment math are what decide the actual answer.
More conventional questions on Income
Educational only. Conventional loan guidelines, lender overlays, rates, fees, PMI, LLPAs, and underwriting requirements can change. Final eligibility depends on full underwriting review.