Source of Funds Documentation
What US banks need to verify your investment capital
📄
More is Better
Banks never reject for too much evidence
⏰
Prepare Before Wire
Gather docs before sending money
📝
Tell the Story
Include a cover letter
🔗
Paper Trail
Show funds moving account to account
SOF vs SOW: What's the Difference?
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
"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
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
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
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
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
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
⚠️ 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
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
⚡ 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
⚠️ 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
Related attorney services
Sergei Tokmakov is a California attorney, State Bar of California No. 279869, licensed since 2011. He prepares and coordinates standard LLC and corporation formations in California, Delaware, and Wyoming. The attorney fee is $500 for a standard LLC formation and $750 for a standard corporation formation. Government filing fees and third-party costs are additional. Exact scope is confirmed in writing before work begins.
- Standard LLC formation, government fees additional: $500
- Standard corporation formation, government fees additional: $750
- Written consultation on one defined legal question: $240
This page provides general information, not legal advice, and does not create an attorney-client relationship. Each engagement requires a conflict check and written confirmation of scope.