Are FHA-approved Mortgagees required to report all income of its employees on a W-2 to the Internal Revenue Service (IRS)?

The Mortgagee, or its permissible contractor, must report all employee compensation on IRS Form W-2.
The Mortgagee must not compensate employees who perform underwriting, Quality Control (QC), or mortgage servicing activities on a commission basis.

For additional information see:

Handbook 4000.1 Section I.A.3.c.iv.(B)(3)(b)(ii) at


All policy information contained in this knowledge base article is based upon the referenced HUD policy document. Any lending or insuring decisions should adhere to the specific information contained in that underlying policy document.

Topic Number: KA-05118