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10 8(a) Application Tips on Personal Tax Returns

Have you provided complete copies of the personal Federal tax returns for the last three years from all required individuals? Federal tax returns are required from each 8(a) applicant and their spouse. Currently, the SBA does not require the same for other individuals who are an officer, director, partner, member and anyone else who holds more than 10% ownership interest in the business concern who is a non-disadvantaged individual with certify.sba.gov. However, be prepared to provide these to the SBA, if requested.

Here are 10 tips to ensure you are complaint with the SBA requirements for your 8(a) Application for personal tax returns.

  1. Do not submit copies of your State income tax returns.
  2. If any of these Individuals are married and have filed taxes separately, you must also submit the personal tax returns the applicable spouse.
  3. Include copies of all W-2 forms and ensure they add up to the wages reported on the personal tax returns.
  4. Ensure that all schedules and attachments identified been included.
  5. Do the tax returns show the correct ownership interest and net income or loss from the 8(a) firm?
  6. Do the tax returns show any other outside business ownership or income. 8(a) Applicants are prohibited from having ownership interest in any other firm, other than the Applicant firm unless it is an LLC for holding real estate.
  7. The SBA will review the 8(a) Applicant’s latest Federal Tax Return and all W-2s submitted to verify that they devote full-time to the 8a applicant business concern.

If you have received a W-2 other than the from the 8(a) Applicant firm in the most recently filed tax return you must provide a letter from the past employer indicating your final date of employment. This letter must eb the past employer’s letterhead and be signed.

  1. The SBA will review the 8(a) Applicant’s income to that they are the highest compensated individual within the business.

If your past income does not prove you are the highest compensated, you must provide a current payroll report to prove you are.

  1. Make sure all tax returns been signed.
  2. If any of your federal tax returns indicated a balance owed, you must include copies of the cancelled check, bank statement or IRS account balance transcript showing the exact payment amount.

View the related article on “8(a) Application Tip on Business Tax Returns”.

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