The main eligibility requirement is the business must be majority (51%) owned and controlled by a socially and economically disadvantaged US Citizen.
- The business must be at least 51% owned and controlled by a socially and economically disadvantaged individual. This individual must be a U.S. citizen.
- Under the Small Business Act, the following individuals are presumed socially disadvantaged:
- Black Americans
- Hispanic Americans
- Asian Pacific Americans
- Native Americans (American Indians, Eskimos, Aleuts, or Native Hawaiians)
- Subcontinent Asian Americans
- Demonstration of economic disadvantage is based on the following Personal Financial Criteria:
- Adjusted Net Worth must not exceed $750,000 (excluding ownership in business and primary personal residence, income reinvested or used to pay taxes of business, or funds in an IRA)
- Personal Income must not exceed $350,000 (averaged over three years, excludes income reinvested or used to pay taxes of business)
- Total Assets must not exceed $6 million (allows for growth during the 9-year term). Total Assets includes applicant’s primary residence and the value of the business concern, but excludes funds invested in IRA or other official retirement account
- Business has not already participated in the 8(a) program
- Applicant (individual) must devote full-time hours to the business
- Applicant business generated revenue during the preceding two years. If no, provide letters of reference for recent successful performance, as well as bank statements
- 70% or more of the firm’s revenue cannot be derived from just one client
- 50% or more of the business cannot be derived from sub-contracts
- The applicant, any owner, key employee, etc. cannot be on probation or parole
- The business concern, applicant(s) and any other owner cannot have filed bankruptcy in the last seven years, unless discharged by the court, and cannot be involved in any pending lawsuits
- All federal debts and obligations must be paid
- The business cannot be owned by an irrevocable trust. The trust must be revocable, where the individual is the grantor, the trustee, and the sole current beneficiary of the trust
For more information on 8a certification: Click Here.
To download the 8a Business Development Spec Sheet: Click Here.