Glossary · Reading the business
In short
This tax status designates an organization as a non-profit, exempt from federal income tax. An SBA 7(a) loan cannot be used to purchase a business with this structure, as they are generally ineligible.
The SBA 7(a) program is designed for for-profit small businesses. A 501(c)(3) non-profit cannot be acquired using an SBA 7(a) loan. If the business you're looking at has this status, you'll need to explore conventional financing options or consider a different acquisition target.
13 CFR Part 120 — Business Loans
Office of the Federal Register · Federal regulation
SOP 50 10 — Lender and Development Company Loan Programs
U.S. Small Business Administration · SBA Standard Operating Procedure
Last checked 2026-06-15. Official sources control — verify before relying on any rule for a live deal.
Defined by DealRoom.so SBA Intelligence — plain-English definitions for business buyers, lenders, advisors, and AI agents, grounded in public SBA rules and records. Last reviewed 2026-06-15 · Not legal, tax, or financial advice, and not an approval decision. Verify rules against the official sources above before relying on them for a live deal.
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