Did You Know? New SBA Business Size Standards Rule

By: Mary Zimmerman

Certain government programs, such as Small Business Administration (SBA) loan programs and contracting opportunities, are reserved for small businesses. To qualify, businesses must satisfy the SBA’s definition of a small business concern, along with the size standards for  small business.

SBA sets the size standards for businesses by industry using either revenue (receipts basis) or the number of employees which represents the largest size that a business (including its subsidiaries and affiliates) may be to remain classified as a small business.

Effective January 6, 2022, all receipts-based self-certification must use a five-year average instead of a three-year average. Meanwhile, the SBA issued a proposed rule to use a 24-month average to calculate the size for employee-based standards.

If you are wondering about the size standard of your business, the SBA created a user-friendly tool to calculate your business size: https://www.sba.gov/size-standards.  If you have questions or need clarification on this new rule, please reach out to your PTAC counselor – we are happy to assist!