SBA rules · SOP 50 10 8.1

Does an SBA loan require tax transcripts?

Yes, SBA 7(a) and 504 loans require lenders to obtain IRS tax transcripts and reconcile them against the applicant's financial records, subject to program-specific timing rules and limited exceptions.

Quoted from SBA SOP 50 10 8.1Every quote checked word for word

In detail

General rule and timing: Except for SBA Express and Export Express, lenders must obtain tax transcripts and reconcile discrepancies before first disbursement on a 7(a) loan, or before submitting the request to fund the debenture on a 504 loan.
Years required: Transcripts must be obtained for the last 3 years under the NAICS Size Standard or the last 2 years under the Alternative Size Standard, covering all years in operation if the business has operated for less time.
SBA Express and Export Express: When creditworthiness is determined without business financial records, such as through credit scoring, lenders must still obtain transcripts to confirm tax filings and business size, but reconciliation is not required, and lenders may disburse prior to obtaining them.
Missing records and amended returns: If the IRS has no record of a return, the loan may close if the lender obtains proof of filing and proof of payment or refund reconciling to the return. If an amended return transcript is unavailable from the IRS, the lender must obtain a copy of the signed amended return and proof of filing.
Territory exception: For applicants in U.S. Territories not required to file Federal income tax returns, lenders verify receipt-stamped copies of returns filed with the territory taxing authority instead of IRS transcripts.

The source

What the SOP says

“Except for the SBA Express and Export Express Programs, SBA Lenders must obtain tax return transcripts and reconcile any discrepancies with the Applicant’s financial data against the tax transcripts, for 7(a), prior to first disbursement of loan proceeds, or for 504, prior to submitting the request to fund the debenture:

SOP 50 10 8.1, Chapter 5: Other Core Requirements > IRS Tax Transcript/Verification of Financial Information (lines 1364-1370)✓ Verified

“NAICS Size Standard: For the Applicant, or the Operating Company if the Applicant is an EPC, for the last 3 years, (unless Applicant or Operating Company is a Start-Up Business). If the business has been operating for less than 3 years, the SBA Lender must obtain the information for all years in operation. Alternative Size Standard: For the Applicant, or the Operating Company if the Applicant is an EPC, for the last 2 years. If the business has been operating for less than 2 years, the SBA Lender must obtain the information for all years in operation.

SOP 50 10 8.1, Chapter 5: Other Core Requirements > If the Applicant is determining eligibility under the SBA size requirements using the: (lines 1371-1374)✓ Verified

“If the Lender does not use business financial information to determine creditworthiness, such as with some credit scoring models, Lender must obtain IRS tax transcripts in order to verify that the returns were filed and for the purpose of determining the Applicant’s size, but reconciliation of the tax transcripts is not required.

SOP 50 10 8.1, Chapter 5: Other Core Requirements > SBA Express and Export Express Programs: (lines 1387-1390)✓ Verified

“If the amended return transcript is not available from the IRS, the Lender must obtain a copy of the signed amended return for verification of financial records and obtain evidence of filing the amended return.

SOP 50 10 8.1, Chapter 5: Other Core Requirements > For loans where 3 years of transcripts are required (lines 1382-1386)✓ Verified

“When the SBA Lender is unable to obtain a required tax transcript due to the IRS having no record of the return, SBA will permit the SBA Lender to proceed with loan closing if both of the following have been obtained:

SOP 50 10 8.1, Chapter 5: Other Core Requirements > No records found (lines 1391-1394)✓ Verified

“If Lender does not use business financial information to determine creditworthiness, such as with some credit scoring models, Lender must obtain IRS tax transcripts in order to verify that the returns were filed and for the purpose of determining the Applicant’s size (but reconciliation of the tax transcripts as set forth in Section A, Ch. 5, Para. B, IRS Tax Transcripts/Verification of Financial Information, is not required).

SOP 50 10 8.1, Appendix 20: Submission of Application for Guaranty > SBA Express (lines 5793-5797)✓ Verified

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