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Source of Funds Documentation

What US banks need to verify your investment capital

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More is Better

Banks never reject for too much evidence

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Prepare Before Wire

Gather docs before sending money

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Tell the Story

Include a cover letter

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Paper Trail

Show funds moving account to account

SOF vs SOW: What's the Difference?

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Source of Funds (SOF)

  • Where this specific money came from
  • Required for most wire transfers
  • Example: "Proceeds from apartment sale"

Source of Wealth (SOW)

  • How you accumulated overall wealth
  • Required for transfers over $500K
  • Example: "20 years as tech entrepreneur"

Cover Letter Template

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"I am writing to provide source of funds documentation for the wire transfer of $275,000 received on [date] into account [number]. These funds represent proceeds from the sale of my apartment located at [address] in [city, country], which I owned since 2015. The property was sold on [date] for [amount], and after paying off the existing mortgage of [amount], I received net proceeds of [amount]. Please find enclosed the following documentation..."

💼 Employment Income / Salary Savings

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Easiest source to document with clear paper trail.

Required Documents

  • Employment letter (name, title, salary, dates)
  • Pay stubs (3-6 months)
  • Tax returns (2-3 years)
  • Bank statements (12-24 months)
  • Employment contract

What Banks Verify

  • Consistent salary deposits
  • Legitimate employer
  • Income matches accumulated savings
  • Tax returns show declared income

🏢 Business Income / Self-Employment

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Requires more documentation than employment income.

Required Documents

  • Business registration documents
  • Business tax returns (2-3 years)
  • Financial statements (audited if available)
  • Business bank statements (12-24 months)
  • Personal tax returns
  • Dividend/distribution docs

What Banks Verify

  • Legitimate operating business
  • Proper registration/licensing
  • Financial statements show profitability
  • Clear trail: business → personal accounts

🏠 Real Estate Sale Proceeds

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Most common source for foreign investors.

Required Documents

  • Property deed/title (prior ownership)
  • Sale contract (signed)
  • Closing statement
  • Wire/check showing receipt
  • Property appraisal
  • Mortgage payoff statement

What Banks Verify

  • You owned the property
  • Arm's length sale
  • Clear receipt of proceeds
  • Reasonable sale price

💰 Business Sale Proceeds

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Common for E-2 or EB-5 investors.

Required Documents

  • Purchase and sale agreement
  • Closing documents
  • Proof of prior ownership
  • Bank statements showing receipt
  • Capital gains tax documents

What Banks Verify

  • Documented sale with clear terms
  • You owned the business
  • Payment was received
  • Proper tax treatment

📈 Securities / Brokerage Proceeds

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Required Documents

  • Brokerage statements (12-24 months)
  • Trade confirmations
  • Tax forms (1099-B or equivalent)
  • Wire/ACH from brokerage
  • Bank statements showing receipt

What Banks Verify

  • Legitimate brokerage account
  • History of investment activity
  • Clear sale transactions
  • Trail from brokerage to bank

₿ Cryptocurrency Proceeds

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⚠️ High Scrutiny — Some banks refuse crypto proceeds entirely

Convert through major regulated exchange, season funds 3-6 months before wire.

Required Documents

  • Exchange statements (purchase history)
  • Sale/conversion from regulated exchange
  • Wire from exchange to bank
  • Tax returns showing gains
  • Exchange KYC confirmation

Red Flags (Avoid)

  • Privacy coins (Monero, Zcash)
  • Mixer/tumbler services
  • Unregulated exchanges
  • No tax reporting

📜 Inheritance

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Required Documents

  • Death certificate
  • Will naming you as beneficiary
  • Probate/estate documents
  • Letter from estate executor
  • Distribution records
  • Relationship proof (birth certificate)

What Banks Verify

  • Proof of death
  • Your relationship to decedent
  • Legal inheritance documentation
  • Actual receipt of funds

🎁 Gift from Family

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⚡ Enhanced Scrutiny — Donor must also prove source of wealth

Required Documents

  • Gift letter (signed, dated)
  • Donor's bank statements
  • Donor's source of wealth docs
  • Relationship proof
  • Gift tax return (if applicable)

Gift Letter Must Include

  • Donor's name, address, relationship
  • Dollar amount and date
  • "No repayment expected" statement
  • Source of the gifted funds
  • Donor's signature

🏦 Loan Proceeds

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⚠️ Private loans from individuals face extreme scrutiny

Required Documents

  • Signed loan agreement
  • Loan approval letter
  • Disbursement records
  • Collateral docs (if secured)
  • Lender's license/registration

What Banks Verify

  • Loan from regulated lender
  • Proper loan documentation
  • Disbursement of proceeds
  • Collateral if secured loan

Master Documentation Checklist

Identity Documents

  • Valid passport (all pages)
  • Government ID
  • Proof of address
  • US visa (if applicable)

Financial History

  • Bank statements (12-24 mo)
  • Tax returns (2-3 years)
  • Brokerage statements
  • Property ownership docs

Income Verification

  • Employment letter
  • Pay stubs (3-6 months)
  • Business registration
  • Financial statements

Transaction Docs

  • Sale contracts
  • Closing statements
  • Wire confirmations
  • Gift letters