# Does an SBA lender verify the seller's tax returns?

**Short answer:** Yes. On a change of ownership, the lender must verify the seller's financial data, including a selling sole proprietor's Schedule C. If transcripts cannot isolate a division being sold, other third-party proof is required. Source: SOP 50 10 8.1, Sec. A, Ch. 5, Para. B.3.

Canonical page: https://www.sbaexpress.loans/answers/does-an-sba-lender-verify-the-sellers-tax-returns/
Last checked: 2026-11-09

Yes. On a change of ownership, the lender must verify the seller's financial data. That includes a selling sole proprietor's Schedule C (SOP 50 10 8.1, Sec. A, Ch. 5, Para. B.3, p. 95). Appendix 15, Para. A treats tax transcripts as part of financial due diligence.

## What gets compared

- The lender must verify the financial information used in the business valuation against the seller's IRS transcripts (Appendix 15, Para. C.1.a).
- A Quality of Earnings report, when required, must reconcile financial statements, tax returns and IRS transcript data (Para. C.1.b).

## What the file needs from the seller

Appendix 20, Para. A.1.k asks for the seller's financial statements for the last 3 complete fiscal years, or the years in business if fewer. Interim statements can be no older than 120 days from submission. Statements must be dated and signed or certified by the seller.

## If a seller has no statements

The seller must give another way to verify revenue. The lender must explain in its credit analysis why statements are missing and how it verified revenue.

## Buying a division

If transcripts cannot identify the division or segment being sold, the lender must use other third-party proof (Para. B.3). Examples are CPA-prepared or reviewed statements, sales tax records and transient occupancy tax records.

## A practical step

Make seller cooperation a term of the deal, and ask early about signing IRS authorizations.

## Sources

- [SOP 50 10 8.1, Sec. A, Ch. 5, Para. B.3 (p. 95)](https://legacy.sba.gov/sites/default/files/2026-10/SOP%2050%2010%208.1%20Technical%20Policy%20Updates%20effective%20%2010.1.2026.docx)
- [SOP 50 10 8.1, Appendix 15, Para. A, Tax Transcripts (about p. 363)](https://legacy.sba.gov/sites/default/files/2026-10/SOP%2050%2010%208.1%20Technical%20Policy%20Updates%20effective%20%2010.1.2026.docx)
- [SOP 50 10 8.1, Appendix 15, Para. C.1 (p. 371)](https://legacy.sba.gov/sites/default/files/2026-10/SOP%2050%2010%208.1%20Technical%20Policy%20Updates%20effective%20%2010.1.2026.docx)
- [SOP 50 10 8.1, Appendix 20, Para. A.1.k (about p. 417)](https://legacy.sba.gov/sites/default/files/2026-10/SOP%2050%2010%208.1%20Technical%20Policy%20Updates%20effective%20%2010.1.2026.docx)