SBA 8a Qualifications
SBA 8a business development eligibility requirements are perplexing and confusing. To minimize this confusion and help the small entrepreneurs determine if 8a certification is appropriate for them, GCS (Government Certification Specialist Inc.) offers the SBA 8a eligibility requirements
However, SBA 8a program eligibility requirements may change in response to the federal court cases. Thus,we ensure to look at the latest rules & regulations when applying for 8a certification.
Here are the core qualification requirements for SBA 8a applicants:
You should be Asian American, Hispanic American, Native American or Black American or an individual who has experienced chronic, persistent bias against you based on gender, disability, veteran status, culture, race or some other factor to be eligible for joining the SBA 8a program. If you are a person from a non-presumed group, you will need to prove the discrimination and bias you have faced in American business and education to the Small Business Administration.
Personal net worth should not be more than $250K
This figure takes into account all the cash that you have, savings and checking accounts, stocks, investment real estate, automobiles, bonds, RVs, motorcycles and other possessions. The value of your home, IRAs, company and 401Ks are acknowledged based on the personal financial statement, but they are not counted towards personal net worth limitation.
An 8a applicant should be the highest paid individual in the firm, but his annual salary should not cost a lot to the industry and must be reasonable in proportion to the annual gross revenue of the firm.
Market value of all the assets
The market value of all the assets of an 8a applicant should not be more than four million dollars.
Average 3-year AGI
An applicant’s average 3-year AGI as per his federal tax returns should not exceed $250K.
The applicant should prove that he or she is an American citizen by providing a passport, birth certificate and other documents.
Size of the business
The size of the company should be small either in terms of gross revenue or staff levels.
An economically and socially disadvantaged person should have unfettered, full control of the firm including both daily operations and deliberate decision making. This individual should hold the most powerful designation in the firm.
One or more economically and socially disadvantaged people should own the company. The owner (s) must have 51% or more share in the firm. It would be an added advantage if the entrepreneur is an Alaska Native Corporation, an Indian tribe, a Community Development Corporation or a Native-Hawaiian Organization.
The company applying for 8a certification should have a considerable contract performance history including a contract completed within the last 1-year and a good portfolio of projects/clients.
Age of the firm
Many 8a applicants think that SBA considers companies that are at least two years old. However, this is wrong. An essential SBA 8a application requirement is that the company must be two or more years of age as proven with 2 or more consecutive years of tax returns showing profits on them. However, firms, which can prove to SBA that they have had many contracts, years of experience and a lot of revenue as well as resources to succeed within the 8a program, will have a chance to be acknowledged early into the program before completing two full years in business.
Potential to succeed
SBA always looks for stable, established, financially sound and well-documented firms with full-time devoted entrepreneurs who are technically qualified and experienced to operate a business.