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08/21/2020
New thresholds for SBA’s 8(a) government contracting assistance program: Who qualifies now?
Certain smaller businesses should re-evaluate whether they qualify for the Small Business Administration’s 8(a) Business Development program for those owned by “socially and economically disadvantaged people or entities,” following the recent effective date of an SBA final rule adjusting the requirements.
Under the new guidelines, the thresholds for owners for “economically disadvantaged” designation have been raised as follows. Note that SBA also will no longer distinguish between “initial” and “continuing” eligibility; these new limits apply regardless of stage.
- Net worth increased from $250,000 to $750,000 (excludes funds invested in individual retirement accounts (IRAs) or other retirement accounts)
- Personal income (averaged over the three preceding years) increased from $250,000 to $350,000
- Fair market value of all assets increased from $4 million to $6 million
This SBA final rule, which went into effect July 15, aligns the 8(a) program with the same eligibility qualifications of the SBA’s Economically Disadvantaged Women-Owned Small Business (EDWOSB) program.
Christine Williamson
CPA, PMP, Partner
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This has been prepared for information purposes and general guidance only and does not constitute legal or professional advice. You should not act upon the information contained in this publication without obtaining specific professional advice. No representation or warranty (express or implied) is made as to the accuracy or completeness of the information contained in this publication, and CohnReznick LLP, its partners, employees and agents accept no liability, and disclaim all responsibility, for the consequences of you or anyone else acting, or refraining to act, in reliance on the information contained in this publication or for any decision based on it.