re: USDA Loan - Business Loss reported on prior Tax Return. Help!

The UW isn't thinking with his RD cap on. He's thinking with his regular products in mind and trying to UW based on that. Your broker needs to communicate back to him by showing him the policy that guides the income.

I don't see the AGI reduction as any issue whatsoever, especially considering the section you're referencing. You can confirm via paperwork that the business dissolved and is no longer capable of reducing your income as a result.

You can also confirm via paycheck stubs, written & verbal VOE that you're at your current POE making your current rate of pay. This should be way more than enough to overcome any stip regarding income requirements for RD.

It's good to be concerned, but don't worry too much about this. You should be good to go, bro.