{"ok":true,"canonical_url":"https://dealroom.so/sba-7a/questions/how-can-a-gift-from-a-close-family-member-contribute-to-my-equity-injection-for-a-600-000-","api_url":"https://dealroom.so/api/public/questions/how-can-a-gift-from-a-close-family-member-contribute-to-my-equity-injection-for-a-600-000-","question":"How can a gift from a close family member contribute to my equity injection for a $600,000 business purchase?","topic":"Gift/investor funds","audience":"borrower","bot_mode":"buyer","short_answer":"A gift from a close family member can count as equity injection if it's an irrevocable gift, properly documented, and the donor provides a gift letter.","rule":"SBA rules allow gifts from close family members (spouse, child, parent, sibling, grandparent) to count as equity injection. The gift must be unconditional, without any expectation of repayment, and the donor must sign a gift letter confirming these terms. The funds must be deposited into the borrower's account.","example":"For a $600,000 business acquisition requiring $60,000 equity, the buyer's parent gifts $30,000. This $30,000, with a proper gift letter and proof of transfer, can be used towards the buyer's equity injection.","what_lenders_check":"Lenders verify the donor's relationship, the irrevocability of the gift, and trace the funds to ensure they are unencumbered and come from an acceptable source. A signed gift letter is mandatory.","required_facts":["Gift funds","Close family member","Irrevocable","Gift letter","Proof of funds"],"source_families":["SOP 50 10 - Lender and Development Company Loan Programs","13 CFR Part 120 - Business Loans"],"official_sources":[{"title":"SOP 50 10 - Lender and Development Company Loan Programs","url":"https://www.sba.gov/sites/default/files/2025-05/SOP%2050%2010%208%20Technical%20Updates%20effective%206.1.2025.docx"},{"title":"13 CFR Part 120 - Business Loans","url":"https://www.ecfr.gov/current/title-13/chapter-I/part-120"}],"related_questions":[{"question":"If my parents gift me $50,000 for a down payment, what specific documentation is required by the SBA?","url":"https://dealroom.so/sba-7a/questions/if-my-parents-gift-me-50-000-for-a-down-payment-what-specific-documentation-is-required-by"},{"question":"Can a corporate entity, not an individual, provide a gift that counts towards my equity injection for an SBA loan?","url":"https://dealroom.so/sba-7a/questions/can-a-corporate-entity-not-an-individual-provide-a-gift-that-counts-towards-my-equity-inje"},{"question":"Can a gift from a non-family investor count towards my SBA 7(a) equity injection?","url":"https://dealroom.so/sba-7a/questions/can-a-gift-from-a-non-family-investor-count-towards-my-sba-7-a-equity-injection"},{"question":"Can a non-profit organization provide a grant that counts towards my equity injection for an SBA 7(a) loan?","url":"https://dealroom.so/sba-7a/questions/can-a-non-profit-organization-provide-a-grant-that-counts-towards-my-equity-injection-for-"},{"question":"Can a gift from a non-family friend for $50,000 be used for my equity injection on an SBA 7(a) loan?","url":"https://dealroom.so/sba-7a/questions/can-a-gift-from-a-non-family-friend-for-50-000-be-used-for-my-equity-injection-on-an-sba-7"},{"question":"How does the SBA verify a $75,000 cash gift from an unrelated investor for my equity injection?","url":"https://dealroom.so/sba-7a/questions/how-does-the-sba-verify-a-75-000-cash-gift-from-an-unrelated-investor-for-my-equity-inject"}],"related_terms":[{"term":"Close family relationship","url":"https://dealroom.so/glossary/close-family-relationship"},{"term":"Family member transaction","url":"https://dealroom.so/glossary/family-member-transaction"},{"term":"Equity injection","url":"https://dealroom.so/glossary/equity-injection"},{"term":"Minimum Equity Injection","url":"https://dealroom.so/glossary/minimum-equity-injection"},{"term":"Tangible Equity Injection","url":"https://dealroom.so/glossary/tangible-equity-injection"},{"term":"Hidden Equity Injection","url":"https://dealroom.so/glossary/hidden-equity-injection"}],"related_tools":[{"name":"SBA 7(a) payment & fee calculator","url":"https://dealroom.so/sba-7a/calculator"},{"name":"Find an active SBA 7(a) lender","url":"https://dealroom.so/lenders"}],"data_freshness":{"last_reviewed":"2026-06-14","sba_rule_sources_checked_through":"2026-06-14"},"citation":{"label":"DealRoom.so SBA 7(a) Q&A","url":"https://dealroom.so/sba-7a/questions/how-can-a-gift-from-a-close-family-member-contribute-to-my-equity-injection-for-a-600-000-","source_type":"DealRoom Q&A"},"caveats":["Grounded in the current SBA rulebook; verify against official sources before relying on it for a live deal.","Not legal, tax, or financial advice and not an approval decision."]}