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.

How to determine if your Adjusted Gross Income is below the $250,000 threshold

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.

15 8(a) Application Killers

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.

8(a) Application Tip on Business Tax Returns

The SBA will verify the following:

Have you provided complete copies of the Federal business tax returns for the last three years.

  • 1120 or 1120s for Corporations.
  • 1065 for Limited Liability Companies and Partnership.
  • Schedule C for Sole Proprietors or Single Member LLC’s treated as disregard entity.

Five myths about doing business with the Federal Government

Myth #1 – “Only Big Companies Win Contracts”

Fact – Preferential treatment is actually given to small, minority, woman, handicapped and service disabled owned business. Small businesses get awarded close to 25% of all federal contracts.

Between 1/1/2017 through 10/1/2019: 8(a) firms were awarded $34.5 billion in federal contracts. Of that amount, these 8(a) firms were awarded $14.65 billion through 8(a) competitive set-asides and $19.87 billion through sole-source contracts. Hubzone firms were awarded $2.75  billion through set-asides and $161.15 million through sole-source contracts..