It is possible, but two years of tax returns is the default, and one year is an exception you have to fit into. Across FHA, Fannie Mae, and Freddie Mac, the standard for self-employment income is two years of tax returns in the same business or line of work, with income counted as the net after business expenses, averaged over the documented period. Lenders want that history for a simple reason: 1099 revenue says nothing about what it cost you to earn it, and a single year shows revenue without proving your true net income. Two narrower one-year paths exist on conventional loans: - Fannie Mae's DU can permit one year of personal and business returns when every business you are self-employed in has existed for at least five years and you have owned 25% or more of it for the last five consecutive years. That provision is about the business's track record and your ownership, not just years in a line of work. - The shorter-history exception. A borrower with less than two years of self-employment can sometimes qualify with one year when the most recent return covers a full 12 months and the file documents prior work earning similar income in the same field, the classic case being a W-2 employee who went out on their own in the same line of work. Freddie Mac's LPA has analogous provisions. FHA and VA generally want the full two years of returns. Requirements shift, so confirm the current guideline for your specific program, and treat two years as the safer path rather than planning around the exception.