Glossary · Reading the business
In short
The ultimate profit a business makes after all expenses, including federal income taxes, have been deducted. It's the bottom line on the Profit & Loss Statement.
While lenders and buyers often focus on SDE or EBITDA for valuation, the net income after taxes is what the business legally earned and what's available for distribution or reinvestment after the tax burden. It's a key figure on the P&L and helps confirm the business's actual profitability, though adjustments (add-backs) are usually applied to get to SDE.
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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