{"ok":true,"canonical_url":"https://dealroom.so/glossary/distribution-to-owners","api_url":"https://dealroom.so/api/public/glossary/distribution-to-owners","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":"distribution-to-owners","term":"Distribution to owners","aka":"Owner distributions","group":"Reading the business","definition":"Payments made from a business's profits or assets to its owners. These are not wages or salaries but a return on their investment.","what_it_means":"When reviewing financials, analyze distributions to owners to understand how much cash the business historically generated for its owners. Be wary of excessive distributions that might have starved the business of working capital or hidden true profitability. These are often \"added back\" to calculate SDE or EBITDA.","url":"https://dealroom.so/glossary/distribution-to-owners","official_sources":[],"related":[{"slug":"owner-earnings","term":"Owner earnings","url":"https://dealroom.so/glossary/owner-earnings"},{"slug":"add-backs","term":"Add-backs","url":"https://dealroom.so/glossary/add-backs"},{"slug":"sde","term":"SDE","url":"https://dealroom.so/glossary/sde"}],"related_questions":[{"question":"Can life insurance be used to ensure fair distribution of assets among non-active heirs in a family business?","url":"https://dealroom.so/sba-7a/questions/can-life-insurance-be-used-to-ensure-fair-distribution-of-assets-among-non-active-heirs-in"},{"question":"Do all owners of an acquiring business, regardless of ownership percentage, need to provide a personal guaranty?","url":"https://dealroom.so/sba-7a/questions/do-all-owners-of-an-acquiring-business-regardless-of-ownership-percentage-need-to-provide-"},{"question":"Does the SBA require spouses of owners to personally guarantee the loan, even if they have no ownership stake?","url":"https://dealroom.so/sba-7a/questions/does-the-sba-require-spouses-of-owners-to-personally-guarantee-the-loan-even-if-they-have-"},{"question":"Are all business owners, regardless of their ownership percentage, required to sign a personal guaranty for an SBA 7(a) loan?","url":"https://dealroom.so/sba-7a/questions/are-all-business-owners-regardless-of-their-ownership-percentage-required-to-sign-a-person"},{"question":"Why do business owners need to personally guarantee SBA 7(a) loans?","url":"https://dealroom.so/sba-loans/basics/why-do-business-owners-need-to-personally-guarantee-sba-7-a-loans"},{"question":"Do all 20% owners have to guarantee an SBA 7(a) loan?","url":"https://dealroom.so/for-lenders/questions/do-all-20-owners-have-to-guarantee-an-sba-7-a-loan"}]},"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 — Distribution to owners","url":"https://dealroom.so/glossary/distribution-to-owners","source_type":"DealRoom Data"}}