Does an SBA Express lender have to verify my taxes with the IRS?
Short answer
Yes. If the lender uses business financials, it must follow SBA's IRS verification process. If not, it must still get transcripts to confirm returns were filed (SOP 50 10 8.1, Sec. A, Ch. 5, Para. B.4.g; Appendix 20, Para. B.3).
Yes. SOP 50 10 8.1, Sec. A, Ch. 5, Para. B and Appendix 20, Para. B.3 set two paths for SBA Express, and both involve IRS tax transcripts.
If the lender uses your business financials
The lender must follow SBA's IRS tax verification process (Para. B.4.g). It must also keep the financial statements, tax returns and schedules its policy requires in the SBA Express file (Appendix 20, Para. B.3).
If the lender does not use them
Some credit scoring models do not rely on business financial information. The lender must still get IRS tax transcripts to verify that returns were filed and to determine your size. It does not have to reconcile the transcripts with your financial data (Para. B.4.g).
Closing before the transcripts arrive
If you ask, an SBA Express lender may close and disburse before verification is complete. It must still follow up and verify afterward. If it cannot get the transcript, the guaranty may be subject to repair or denial (Para. B.4.g).
What you need to do
- File your required federal tax returns. An applicant that has not filed is not eligible (Para. B.2).
- Expect to sign IRS authorization paperwork. SBA lists Income Verification Express Service (IVES) and IRS Form 8821 as the two methods (Para. B.4.b).
- Tell the lender about extensions or amended returns (Para. B.4).
Ask lending partners about your loan
Tell us the amount you need and what it is for. We refer you to lenders that may fund businesses like yours, and it costs you nothing.
Janover Capital LLC is not a lender and is not the SBA. The lender makes the credit decision. A lender or marketplace may pay us a referral fee if we connect you, at no cost to you. Advertiser disclosure.