Employment Verification in 2026: Pay Stubs, EIV, The Work Number & HOTMA 💼📂

Erica Davis
Aug 5
13 min read

Employment income.

It is probably one of the most common sources of income we calculate in affordable housing.

Get the verification. Calculate the income. Move on to the next section of the file.

Easy enough, right?

Well…until EIV shows one amount, The Work Number shows another, the pay stubs tell a completely different story, and the employer has apparently entered the Witness Protection Program because nobody can get them to return a verification form. 😂

Employment verification practices have also changed.

For years, affordable housing professionals were trained to send a traditional

Verification of Employment (VOE) directly to the employer and wait for it to come back before moving forward.

We collected four pay stubs. Six pay stubs. Eight pay stubs.

Sometimes, apparently, we wanted the household member’s entire payroll history since birth. 😂

But verification practices have evolved, particularly with HOTMA changes and the updated verification hierarchy.

Whether you are a property manager, assistant manager, occupancy specialist, leasing professional, or compliance reviewer, understanding what documentation to collect, which verification source to use, and how to calculate anticipated income is critical to preparing an accurate and compliant file.

Because employment verification is not simply about collecting documents.

It is about determining what the household member is reasonably expected to earn during the applicable certification period.

Let’s break it down.

First Things First: Verification Requirements Are Not One-Size-Fits-All 🧐

One of the biggest mistakes in affordable housing compliance is assuming that every program follows exactly the same verification requirements.

They do not.

HUD establishes verification requirements for applicable HUD programs.

LIHTC properties must consider Section 42 requirements, IRS guidance, applicable state Housing Finance Agency procedures, and established owner or management agent policies.

HOME-assisted properties must follow applicable HOME requirements and Participating Jurisdiction procedures.

And at layered properties?

You may be dealing with more than one set of requirements.

However, there is another important reality to understand.

Affordable housing programs do not operate in completely separate universes.

Many state Housing Finance Agencies have historically looked to HUD guidance when establishing or updating their LIHTC compliance procedures. As HOTMA implementation has progressed, many agencies have also updated—or are updating—their employment verification requirements and policies.

That is why understanding the current industry standard matters.

But so does knowing the specific rules governing your property.

💡 TCC Tidbit: Know the current standard. Then know the requirements applicable

to your file.

Employment Verification Has Changed 🔄

For years, the traditional third-party Verification of Employment was considered the gold standard.

Property staff sent the form directly to the employer.

The employer completed it.

The employer returned it.

And eventually—after three emails, two faxes, four phone calls, and perhaps a small miracle—the property received the verification. 😂

HOTMA changed HUD’s verification framework and elevated the use of acceptable tenant-provided documentation, including current pay stubs.

That means the traditional written VOE may no longer automatically be the first or preferred verification method under the requirements governing the property.

This is an important shift.

More documentation does not automatically mean better compliance.

If the applicable program, state agency, and organizational policies allow the use of current pay stubs, collecting a stack of pay stubs and a traditional VOE simply because “that’s how we’ve always done it” may create unnecessary work.

Even worse?

Now you may have multiple documents containing different information that must be reviewed, explained, and resolved.

📌 TCC Tidbit: Collect the documentation you need.

Then analyze it properly.

Compliance is not a paper-collecting competition.

So…How Many Pay Stubs Do You Actually Need? 💵

Here is the question everyone wants answered.

Two current and consecutive pay stubs have become the prevailing industry practice for verifying employment income under the updated HUD/HOTMA framework and across many LIHTC state agencies that have aligned their procedures with current HUD verification practices.

That is a significant change from the traditional practice of automatically collecting four, six, or more pay stubs.

But—and this is important—

Two pay stubs should not be treated as a universal requirement for every affordable housing program, property, or organization.

Before establishing your verification procedures, check:

The applicable housing program requirements
Your state Housing Finance Agency’s current compliance manual or guidance
The Participating Jurisdiction’s requirements for HOME-assisted units
The owner or management agent’s written policies
Any additional requirements applicable to layered properties

💡 TCC Tidbit: Two current and consecutive pay stubs may be the prevailing industry practice, but industry practice does not override your state agency or organizational requirements.

Know the standard. Then check the rules governing your property.

Let’s Talk About the Verification Hierarchy 📊

Under HUD’s updated verification framework, the method used to verify income depends on the available documentation and applicable program requirements.

Verification methods may include:

Upfront Income Verification (UIV) systems, such as EIV
Acceptable tenant-provided documentation, including current pay stubs
Written third-party verification
Oral third-party verification
Self-certification when permitted and when other acceptable verification methods are unavailable

The exact hierarchy, documentation requirements, and exceptions should follow current program guidance.

But one thing is clear:

The old habit of automatically sending a written VOE to every employer should not replace understanding the current verification requirements.

At the same time, receiving two pay stubs does not mean the review is complete.

Whoever is working or reviewing the file still needs to determine whether the documentation is:

Current
Consecutive
Complete
Consistent with the household member’s reported circumstances
Sufficient to identify all sources of compensation
Reasonable for projecting anticipated income

📌 Verification is not simply document collection.

It is the process of gathering, comparing, analyzing, and resolving information to determine anticipated income.

EIV: What It Tells You—and What It Doesn’t 🖥️

For applicable HUD programs, EIV plays an important role in income verification.

EIV may provide information regarding:

Employment and wages
Unemployment compensation
Social Security benefits
SSI benefits
New hire information

But EIV is not a crystal ball. 🔮

The information may reflect historical earnings and may not always capture the household member’s current employment circumstances.

For example, EIV may show:

Employment the household member has already left
Earnings from a previous reporting period
Multiple employers
Income that differs from what the household reported
A new employer that requires additional review

EIV may also fail to identify certain income sources.

💡 TCC Tidbit: EIV is a verification tool—not a substitute for reviewing the household’s current circumstances.

If EIV conflicts with what the household reports or with other documentation in the file, the discrepancy should be investigated and resolved.

What About The Work Number? 💻

The Work Number, operated by Equifax, is an employment and income verification service used by many employers.

Depending on the property, owner, management company, and applicable program requirements, The Work Number may be used to obtain third-party employment information.

A report may include:

Employer information
Employment status
Dates of employment
Pay rate
Pay frequency
Historical earnings
Year-to-date earnings

Sounds perfect, right?

Not always. 😂

Before using the information to calculate income, review the report carefully.

Ask:

Is the employment current?
How recent is the information?
Does the report identify the current rate of pay?
Are hours worked consistent or variable?
Is overtime included?
Are bonuses or commissions reported?
Does the information agree with the household member’s statements?
Does the information reasonably reflect anticipated income?

📌 TCC Tidbit: The Work Number may provide the verification.

The person working the file still has to do the analysis.

EIV vs. The Work Number: What’s the Difference? 🤔

This is an important distinction.

EIV is HUD’s Enterprise Income Verification system used for applicable HUD-assisted housing programs.

The Work Number is a private third-party employment and income verification service.

They are not interchangeable.

At an applicable HUD-assisted property, EIV requirements should be followed.

At an LIHTC property without HUD assistance, The Work Number may be an acceptable verification source depending on the state Housing Finance Agency requirements and established owner or management agent policies.

At a layered property, both may be relevant.

💡 TCC Tidbit: The question should not be:

“Which system do I like better?”

The question should be:

“What verification methods are required and acceptable for the programs governing this file?”

Let’s Talk About Pay Stubs 🧮

Whether you are reviewing two pay stubs or another number required by the applicable program or organizational policy, do not simply look at the gross amount and start calculating.

Review the entire document.

Look for:

Rate of pay
Hours worked
Pay frequency
Year-to-date earnings
Overtime
Bonuses
Commissions
Shift differentials
Tips
Holiday pay
Vacation pay
Other recurring compensation

And most importantly:

Look for patterns.

Two pay stubs may satisfy a documentation requirement.

But the person working the file still needs to determine whether those two pay stubs reasonably reflect what the household member is expected to earn moving forward.

Current Earnings vs. Year-to-Date Earnings: Which One Should You Use? 📈

This is where employment calculations can get interesting.

Suppose a household member earns $20 per hour and reports working 40 hours per week.

The basic annualized calculation would be:

$20 × 40 hours × 52 weeks = $41,600

But the most recent pay stub shows year-to-date earnings that annualize to $47,500.

Now what?

Do you automatically use $47,500 because it is higher?

No.

Do you automatically use $41,600 because that is the household member’s current rate?

Also no.

Whoever is working the file should determine why the numbers are different.

The difference could result from:

Overtime
Bonuses
A recent raise
A reduction in hours
Unpaid leave
Seasonal employment
Shift differentials
A change in position
Irregular work schedules

📌 TCC Tidbit: The goal is not to find the highest number.

The goal is to determine the most reasonable anticipated income based on the household’s current circumstances and available documentation.

Let’s Look at an Example 👇🏾

A household member provides a pay stub dated August 15 showing:

Year-to-date gross earnings: $24,000
16 semi-monthly pay periods completed
24 pay periods per year

The YTD annualized calculation is:

$24,000 ÷ 16 × 24 = $36,000

However, the household member recently received a raise.

Current earnings now annualize to $40,000 per year.

Which amount should be used?

The file should not automatically use $36,000 simply because that is what the YTD calculation produces.

The YTD earnings include income received before the raise.

If the raise is expected to continue, the current rate may more accurately represent anticipated income.

The file should document:

The previous rate of pay
The new rate of pay
The effective date of the increase
The expected hours
The methodology used to calculate anticipated income

The math should follow the facts—not the other way around.

What About Overtime, Bonuses, and Commissions?

Another common mistake is assuming that overtime or bonuses should automatically be excluded because they are not guaranteed.

Not necessarily.

The person working the file should evaluate whether the income is expected to continue.

Ask:

Has the household member regularly received overtime?
Is the overtime seasonal?
Is it expected to continue?
Does the year-to-date income include a one-time bonus?
Are commissions consistent or variable?
Did the household member recently change positions or schedules?

If the pay stubs show recurring overtime but the household member says:

“I don’t know if I’ll work overtime anymore.”

That statement alone may not be enough to ignore the income.

On the other hand, if the employer eliminated overtime or the household member changed positions, the historical earnings may no longer reasonably reflect anticipated income.

📌 Document the circumstances.

The calculation should show not only what income was counted, but also why the methodology was reasonable.

“My Employer Won’t Return the Verification.” Now What? 📵

We have all been there.

The verification was emailed.

Then faxed.

Then emailed again.

Someone called HR.

Someone left a voicemail.

And still…nothing. 🦗😂

First, determine whether a traditional VOE is even required under the current requirements governing the file.

If acceptable tenant-provided documentation can be used, repeatedly chasing an employer for a form that is not required may be unnecessary.

Depending on the applicable program requirements, alternative documentation may include:

Current and consecutive pay stubs
The Work Number or another approved verification service
An employment offer letter
Payroll records
Other acceptable third-party documentation
Documented oral verification
Self-certification when permitted

If attempts to obtain verification are required, document them.

The file should show:

What verification was requested
When it was requested
How the request was made
Whether follow-up attempts occurred
Why alternative documentation was ultimately used

💡 TCC Tidbit: Before spending two weeks chasing HR, make sure you actually need the form you are chasing.

“I Just Started This Job.” Now What? 🆕

New employment requires a forward-looking calculation.

The household member may not have:

Two current and consecutive pay stubs
Year-to-date earnings
Historical income from the employer

Documentation may include:

An employment offer letter
A new hire letter
Employer verification
Available pay stubs
Other acceptable documentation

Whoever is working the file should determine:

Rate of pay
Expected hours
Pay frequency
Anticipated overtime
Bonuses or commissions
Employment start date

The income should then be projected based on the best available information and applicable program requirements.

📌 Do not invent a universal 90-day recertification requirement simply because the income is new or uncertain.

Follow the applicable program, agency, and owner requirements for monitoring subsequent income changes.

“I Get Paid in Cash.” Now What? 💵

Cash income does not automatically mean the income cannot be verified.

And it definitely does not mean the income does not count.

Documentation may include:

Employer verification
Bank deposit records
Payment receipts
Earnings logs
Work schedules
Other supporting documentation
Self-certification when permitted

Whoever is working the file should ask enough questions to understand:

Who pays the household member?
How often are they paid?
How much are they paid?
How many hours do they work?
Is the work expected to continue?
Is the income deposited into a bank account?

💡 TCC Tidbit: Cash income may require additional documentation and analysis.

But the goal remains the same:

Determine a reasonable anticipated income and document how you got there.

And Then There’s HOTMA… 😅

HOTMA changed several aspects of income calculation and verification for applicable affordable housing programs.

One of the most important changes for employment verification is the increased emphasis on acceptable tenant-provided documentation and the updated verification framework.

However:

HOTMA implementation and verification requirements remain program-specific.

Do not assume that a verification procedure implemented for HUD Multifamily automatically applies identically to LIHTC, HOME, Rural Development, or another affordable housing program.

At the same time, do not ignore the reality that many state Housing Finance

Agencies have incorporated or aligned aspects of their LIHTC procedures with current HUD guidance.

Property staff and compliance teams should follow:

Current program guidance
Applicable agency requirements
State Housing Finance Agency procedures
Participating Jurisdiction requirements
Owner and management agent policies

📌 TCC Tidbit: “HOTMA says so” is not enough.

Know which program requirement applies, whether it has been implemented, and how it affects the file you are working.

Same Job. Different Program. Different Verification Requirements. 🏘️

HUD Multifamily Housing/PBRA

Applicable HUD properties must follow current HUD income verification requirements, including EIV procedures when required.

Under HUD’s updated verification framework, acceptable tenant-provided documentation has taken on increased importance.

Two current and consecutive pay stubs may be used when applicable under current HUD requirements.

EIV information should still be reviewed along with household-reported information and other applicable documentation.

Discrepancies should be investigated and resolved.

📌 HUD takeaway: Use the required verification systems and current verification hierarchy, but do not stop analyzing the file simply because EIV or two pay stubs are present.

LIHTC

LIHTC is governed by Section 42, IRS requirements, and applicable state Housing Finance Agency procedures.

However, many state Housing Finance Agencies have aligned or updated their employment verification procedures based on current HUD guidance and HOTMA-related changes.

As a result, two current and consecutive pay stubs have become a common industry standard for employment verification across many LIHTC programs.

But state agency requirements can vary.

Before establishing or changing employment verification procedures, review:

The state agency’s current compliance manual
Current notices or implementation guidance
Required verification forms
Owner or management agent policies

📌 LIHTC takeaway: Two current and consecutive pay stubs may be the prevailing industry practice, but always confirm the requirements of the state agency monitoring the property and your organization’s established policies.

HOME

HOME-assisted properties should follow current HOME requirements and the procedures established by the Participating Jurisdiction.

Do not automatically apply HUD Multifamily or LIHTC verification procedures to a HOME-assisted household.

The applicable income definition, verification methodology, and Participating Jurisdiction requirements should be identified before determining what documentation is sufficient.

📌 HOME takeaway: Know the applicable income methodology and the Participating Jurisdiction’s requirements before determining how employment income should be verified and calculated.

Layered Properties

At layered properties, more than one program may govern the household and unit.

For example, a household may occupy:

An LIHTC unit with HUD project-based rental assistance
An LIHTC and HOME-assisted unit
A HOME-assisted unit with rental assistance
A unit governed by several affordable housing programs

Whoever is working or reviewing the file should:

Identify all applicable funding sources.
Determine the verification requirements for each program.
Review applicable state and local agency procedures.
Apply established owner or management policies.
Obtain sufficient documentation.
Resolve discrepancies.
Maintain a file that supports compliance with all applicable programs.

💡 TCC Tidbit: One household member. One employer. One paycheck.

Potentially three different compliance manuals telling you what to do with it.

Welcome to affordable housing. 😂

What About Income Averaging? 🏢

Accurate employment income calculations are especially important at LIHTC properties using Income Averaging.

Household income affects initial eligibility and the unit’s designated income limitation.

Changes in household income after move-in may also require analysis under applicable Available Unit Rule requirements.

The important point?

Get the income calculation right from the beginning.

The unit designation, household eligibility, applicable set-aside requirements, and Available Unit Rule should all be properly evaluated and documented.

📌 Remember: Income Averaging does not change the need to accurately verify and calculate anticipated income.

The income calculation establishes the foundation for the eligibility determination.

Before You Approve That File…Check This List ✅

Your employment income documentation may include:

✅ Two current and consecutive pay stubs when permitted or required by the applicable program, state agency, and organizational policies

✅ Applicable EIV reports for HUD-assisted households

✅ The Work Number or another acceptable third-party verification source when applicable

✅ Direct employer verification when required or appropriate

✅ Documentation of the current rate of pay and expected hours

✅ Review of year-to-date earnings

✅ Review of overtime, bonuses, commissions, tips, shift differentials, and other compensation

✅ Comparison of current earnings and historical earnings when applicable

✅ Documentation explaining significant income differences or changes

✅ Income calculation worksheet showing the methodology used

✅ Resolution of discrepancies between verification sources

✅ Documentation of unsuccessful third-party verification attempts when applicable

✅ Alternative documentation when permitted by the applicable program requirements

✅ Review of applicable state Housing Finance Agency requirements

✅ Review of owner or management agent verification policies

✅ Documentation sufficient to meet the requirements of all applicable funding sources

And perhaps most importantly:

✅ Enough documentation for another person reviewing the file—or an auditor—to understand what income was verified, how anticipated income was calculated, and why the final determination is reasonable.

The Bottom Line 🎯

Employment verification has changed.

The traditional Verification of Employment is no longer automatically the first—or best—document to collect in every situation.

Two current and consecutive pay stubs have become a prevailing industry practice under the updated HUD/HOTMA framework and across many LIHTC state agencies.

EIV provides valuable information.

The Work Number can provide third-party employment data.

Pay stubs can show current earnings.

Traditional employer verification still has its place.

But none of these documents eliminates the need for someone to actually analyze the file.

Whether you are a property manager, assistant manager, occupancy specialist, leasing professional, or compliance reviewer, the responsibility is the same:

Know the program. Collect the appropriate documentation. Review the information. Resolve discrepancies. Calculate anticipated income. Document your methodology.

And before you collect six pay stubs, send three VOE requests, pull The Work

Number, and print 47 pages from EIV…

Ask yourself one question:

What do the current requirements actually require me to obtain? 😂

Because good compliance is not about collecting the most paper.

It is about collecting the right documentation, applying the right requirements, and making a determination that the file can support.

Need support strengthening your compliance processes or reviewing complex affordable housing files?

The TCC Firm partners with affordable housing owners, operators, and site teams through practical compliance guidance, file review support, training, and customized compliance solutions.

👉🏾 Visit www.thetccfirm.com to learn more.

Compliance made manageable. Practical support. Real partnership.