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Credit Cards

How to Report Accessible Income on a Credit Card Application

Updated Jun 13, 2023   |   3-min read

If you are looking for a new credit card, you should expect to be asked about income, and how much of it you have. If you are a typical employee with a fixed amount of income or salary per month, it’s an easy answer; you simply use your gross, pre-tax income.

But what if you’re self-employed or work a job with a constantly shifting income? What if you’re in commission-based or direct sales that offer a feast one month and famine the next? If you’re in college or a stay-at-home parent, you might have access to money you didn’t technically earn as income, such as your spouse’s paychecks or a monthly allowance from your parents. Can you still report that income even though you didn’t make it?

Accessible Income on a Credit Card Application

Yes, this is called accessible income. In 2009, the Credit Card Accountability Responsibility and Disclosure (CARD) Act passed into law and requires lenders to only extend credit to you if they think you can pay your bill. If they don’t think you make enough money to handle payments, they’ll curtail your available credit accordingly, or simply decline your application outright. That’s why they ask for your income.

The flip side of the CARD Act, however, is where previously you could only count income earned by you, now you can count a lot more, such as household income. According to the law, if you are over 21, you can report any income you have a “reasonable expectation of access” to, which could include any of the following:

  • Paychecks and/or tips
  • ​Your spouse’s income
  • ​An allowance from your parents
  • ​Financial gifts
  • ​Trust funds
  • ​Scholarships, grants, and other financial aid
  • ​Retirement funds
  • Social Security or SSI Disability payments

In order to report that accessible income, just add up the various amounts for any income sources you’d like to count and put down the total. You won’t be asked to lay out the specific source of each facet of your income, putting the monthly total is fine.

What Happens If Someone Exaggerates Their Accessible Income?

You might be wondering if someone could just lie on the application and put down more than they’re actually making. Sure, they could, but it’s a bad idea. The credit card company can do an analysis of an applicant’s other accounts and credit history and determine if they’re lying on a credit card application.

Besides, part of what determines your credit limit is your reported income. If you are dishonest and report a higher accessible income than what you truly have, you could end up with more credit than you can responsibly handle. And when the bill finally comes due, you may find yourself in a lot of financial trouble.

With the 2009 rules now in place, there’s no reason to be dishonest about your income. If you’re over 21, the options of what you can report as accessible income are wide enough to get the credit you need. Take the time to look at what you can report, and make sure you’re giving the credit card company the best possible view of your true financial situation.

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