{"ok":true,"canonical_url":"https://dealroom.so/glossary/add-backs","api_url":"https://dealroom.so/api/public/glossary/add-backs","data_freshness":{"sba_records_through":"2026-05-31","fdic_records_through":"2026-03-31","dealroom_last_updated":"2026-06-15","timezone":"America/Chicago"},"source_summary":["Public SBA 7(a) loan records","FDIC institution data","DealRoom lender and franchise enrichment"],"term":{"slug":"add-backs","term":"Add-backs","group":"Reading the business","definition":"Personal or one-time expenses added back to profit to show true earnings (owner's car, one-time lawsuit). Lenders only accept documented ones.","what_it_means":"Add-backs are legitimate when they're truly personal (the owner's cell phone, a family member's salary who won't stay) or genuinely one-time (a roof replacement, a one-time legal settlement). The problem: sellers sometimes inflate add-backs to make the business look more profitable. Lenders scrutinize every add-back carefully, and they'll disallow any that aren't clearly documented and non-recurring. Your attorney should review the add-back schedule before you finalize the LOI.","url":"https://dealroom.so/glossary/add-backs","official_sources":[],"related":[{"slug":"ebitda","term":"EBITDA","url":"https://dealroom.so/glossary/ebitda"},{"slug":"sde","term":"SDE","url":"https://dealroom.so/glossary/sde"},{"slug":"irs-transcripts","term":"IRS transcripts (4506-T)","url":"https://dealroom.so/glossary/irs-transcripts"},{"slug":"dscr","term":"DSCR","url":"https://dealroom.so/glossary/dscr"}],"related_questions":[{"question":"What is the maximum interest rate spread a lender can add over the base rate for an SBA 7(a) loan?","url":"https://dealroom.so/sba-7a/questions/what-is-the-maximum-interest-rate-spread-a-lender-can-add-over-the-base-rate-for-an-sba-7-"}]},"caveats":["Definitions represent DealRoom's plain-English interpretation for buyers; verify regulatory terms against the official SBA and eCFR sources listed.","Not legal, tax, or financial advice, and not an SBA eligibility determination."],"citation":{"label":"DealRoom.so Glossary — Add-backs","url":"https://dealroom.so/glossary/add-backs","source_type":"DealRoom Data"}}