When you apply for the 8(a) Program through certify.sba.gov the SBA will require that you provide a detailed listing of your contracts* for the last 12 months.
Tip: We also suggest that you take a look at this breakdown for the last completed (e.g., 2018, 207 and 2016) three years too. The SBA is likely to request this additional information to look at your economic dependency.
You must provide copies of all the required and special licenses (e.g., city, county, and state business licenses, special licenses, etc.)?
Surprisingly, many of our clients do not have the required county or state license when we speak with them. For example – If your business is located in Fairfax County, Virginia you must have a Business Professional and Occupational License (BPOL).
The SBA will review an 8(a) Applicants business loans and lines of credit in great detail.
Here are eight items the SBA looks at:
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.
Most businesses realize the need for a DUNS number when doing business with the government. It is necessary to register a business in SAM.GOV and to get paid on government contracts. But most do not know that it is possible to have more than one DUNS number and in many cases it is necessary.
The $250,000 Threshold for Adjusted Gross Income (AGI)
Among the many 8(a) business development program eligibility requirements the applicant for 8(a) Certification must have is an average AGI over the past three taxes years of less than $250,000.
What is the definition of Adjusted Gross Income?
Adjusted gross income (AGI) is a tax term for an amount used in the calculation of an individual’s income tax liability. AGI is calculated by taking the applicants gross income and subtracting their maximum allowable adjustments. AGI is located on line 37 on your Form 1040 for 2017 personal taxes and before and on Line 7 for 2018 personal taxes.
The most common misunderstanding that many of our clients come to us with is not knowing which employees count towards the 35% Hubzone residency requirement and how the principal office is determined. Many think that as long as 35% of the employees in their principal office reside in a Hubzone, they will qualify. This is not true.
Any individual who has an arrest record must indicate information within their 8(a) Application within certify.sba.gov.
What is the impact:
The impact of an arrest record can result in either the denial of the 8(a) Application or a delay in its processing.
Spending the time upfront to ensure that your firm meets all of the eligibility requirements for 8(a) Certification can save you countless hours of frustration, the expense of putting the application together incorrectly and the difference between obtaining formal 8(a) Certification or not.
Below are just 15 of the 8(a) Application “Killers”. These will immediately tell you whether you have an issue that may prevent you from qualifying for 8(a) Program certification. We also offer a online 8(a) eligibility questionnaire to help determine your overall 8(a) Program eligibility.
The SBA will verify the following:
Have you provided complete copies of the Federal business tax returns for the last three years.
