Gross Annual Income for the HMDA LAR .
from the tax return - is it the line 22 Total income or line 37 adjusted gross income?

Gross = before any adjustments.

You report the gross annual income used to underwrite the loan; in other words, you use the gross amount that was used to calculate ratios or cash flow. You really need to be able to trace the income amount back to the LO/underwriter, not just pull it from the tax returns.

Here is a discussion on this: http://www.bankersonline.com/forum/ubbthreads.php?ubb=showflat&Number=848856

That is a good point. When I review files, I want to be able to tie back to what the underwriter used. That needs to be reflected somewhere. And there should be a standard process for how it is done or the bank can end up with fair lending problems. I have seen files where there was no way to figure out how the income was arrived at...gives me pause for concern and I comment upon it.

I should add that I have not seen banks cited by regulators for reporting actual income relied upon (with losses deducted etc.) but have seen them cited for not being able to tie to the figure in the file.

KB, to expand on your point, I have even seen regulators start to "decide" how income calculations should have been done when a standard is lacking in a bank. When there is a standard, it is much more difficult for regulators to criticize the Bank.

Does the government have any idea just how much time we in the compliance community spend trying to decipher their regulations and figuring out just how the heck we're supposed to give them exactly what they want?!?

No.