Glossary · Reading the business
In short
This means a business has failed to pay its required taxes on time, potentially resulting in penalties, interest, and government liens. It signals financial distress and compliance issues.
Lenders will pull IRS transcripts (Form 4506-T) for the business and seller to verify tax payments. Any unpaid taxes must be resolved at or before closing, often through an escrow or direct payment from seller proceeds, as an SBA loan cannot be used to pay delinquent federal taxes.
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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