{"ok":true,"canonical_url":"https://dealroom.so/sba-7a/questions/how-does-the-sba-define-active-ownership-for-the-24-month-rule","api_url":"https://dealroom.so/api/public/questions/how-does-the-sba-define-active-ownership-for-the-24-month-rule","question":"How does the SBA define 'active ownership' for the 24-month rule?","topic":"Partner & owner buyout","audience":"borrower","bot_mode":"buyer","short_answer":"Active ownership for the 24-month rule means the owner has been involved in the day-to-day management and operations of the business.","rule":"Active ownership implies significant involvement in the strategic direction and daily operations, not merely a passive investment. The owner must have demonstrated a material role in management, decision-making, and labor within the business for the entire 24-month period prior to the buyout application.","example":"If a partner only contributed capital and attended quarterly board meetings, they would not be considered an active owner for the 24-month rule. However, a partner who managed sales, operations, or finance daily would qualify.","what_lenders_check":"Lenders review payroll records, organizational charts, prior operating agreements, and interview the buyer to confirm their active role and responsibilities over the 24-month period. They look for verifiable evidence of substantive operational involvement.","required_facts":["Day-to-day management","Operational involvement","Not passive investment","Material role required"],"source_families":["SOP 50 10 — Lender and Development Company Loan Programs"],"official_sources":[{"title":"SOP 50 10 — Lender and Development Company Loan Programs","url":"https://www.sba.gov/document/sop-50-10-lender-development-company-loan-programs"}],"related_questions":[{"question":"Can I buy out my business partner with an SBA 7(a) loan?","url":"https://dealroom.so/sba-7a/questions/can-i-buy-out-my-business-partner-with-an-sba-7-a-loan"},{"question":"Can a partner buyout be done with zero money down under the SBA?","url":"https://dealroom.so/sba-7a/questions/can-a-partner-buyout-be-done-with-zero-money-down-under-the-sba"},{"question":"What is the 24-month ownership rule for a $0-down SBA partner buyout?","url":"https://dealroom.so/sba-7a/questions/what-is-the-24-month-ownership-rule-for-a-0-down-sba-partner-buyout"},{"question":"Is a partner buyout a complete or partial change of ownership for the SBA?","url":"https://dealroom.so/sba-7a/questions/is-a-partner-buyout-a-complete-or-partial-change-of-ownership-for-the-sba"},{"question":"Does the remaining owner have to personally guarantee the SBA loan after a buyout?","url":"https://dealroom.so/sba-7a/questions/does-the-remaining-owner-have-to-personally-guarantee-the-sba-loan-after-a-buyout"},{"question":"Can the company itself redeem the departing partner's shares with an SBA loan?","url":"https://dealroom.so/sba-7a/questions/can-the-company-itself-redeem-the-departing-partner-s-shares-with-an-sba-loan"}],"related_terms":[{"term":"Partner buyout","url":"https://dealroom.so/glossary/partner-buyout"},{"term":"Owner Buyout","url":"https://dealroom.so/glossary/owner-buyout"},{"term":"Buyout of a Partner","url":"https://dealroom.so/glossary/buyout-of-a-partner"},{"term":"SBA resource partner","url":"https://dealroom.so/glossary/sba-resource-partner"},{"term":"Buyout","url":"https://dealroom.so/glossary/buyout"},{"term":"Partner","url":"https://dealroom.so/glossary/partner"}],"related_tools":[{"name":"Partner Buyout toolkit","url":"https://dealroom.so/sba-7a/partner-buyout"},{"name":"Find an active SBA 7(a) lender","url":"https://dealroom.so/lenders"}],"data_freshness":{"last_reviewed":"2026-06-15","sba_rule_sources_checked_through":"2026-06-15"},"citation":{"label":"DealRoom.so SBA 7(a) Q&A","url":"https://dealroom.so/sba-7a/questions/how-does-the-sba-define-active-ownership-for-the-24-month-rule","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."]}