For many people, one of the more challenging aspects of self-employment is dealing with the financial feast or famine cycle. Sometimes the money is flowing so freely, you are practically bathing in cash. Other times, you barely have two nickels to rub together. If you have an emergency when cash is tight, you may be wondering if it's possible to get a payday loan even though you're self-employed. The answer is yes, but the biggest challenge will be verifying your income to get the loan. Here are three ways you can show how much money you make so you can get the cash you need fast.

Verifying Income

Payday loans are fairly easy to get. Generally, all you need is valid identification, a checking account, and verifiable income. People who work for others can typically show their last few paycheck stubs to confirm their monthly income. However, this generally isn't an option for most people who are self-employed as they are paid directly by their customers.

Luckily, many companies that offer payday loans accept alternative forms of income verification. One option is to present bank statements detailing the payments you received from your business. The lender will usually base the amount of your loan on the total income you receive for the month or average over several months, depending on the number of bank statements the company requires. Some cash advance businesses may only want the most current statement and others may want statements for the last several months.

Another way to prove your income is to produce the Schedule C of your tax returns. This is the form self-employed people must submit to the IRS when filing taxes that shows your profits and losses. Lenders in other financial industries (e.g. mortgages) typically want you to produce at least two years worth of tax returns. However, the payday loan company may not be as strict and may only require one.

A third option for verifying your income is to produce business contracts detailing your future income. This may be invoices you have billed out and expect to be paid by the time the loan comes due. Be aware, though, the payday loan company may still require you to submit bank or tax statements so they can get an idea of how much you make on average.

Supply References

Another thing to be aware of is the payday loan company may require you to supply more references than usual since you don't have an employer they can call to verify your employment or to get in touch with you if they can't reach you at your home number. Therefore, be prepared with the names and numbers of friends, family members, and business associates who the company can contact in case they need to locate you.

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