Non-Profit as Small Business?

Does the limitation on subcontracting clause apply to Small Businesses subcontracting to non profits? What is the SBA’s stance on non-profits? If their revenues are under the NAICS limits can they be considered small business?

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“Size standards define the largest size a business can be to participate in government contracting programs and compete for contracts reserved or set aside for small businesses. Size standards vary by industry, and are generally based on the number of employees or the amount of annual receipts the business has.”

Annual receipts: This is the “total income” (or “gross income”) plus the “cost of goods sold.” These numbers can normally be found on the business’ IRS tax return forms. Receipts are averaged over a business’ latest three complete fiscal years to determine the average annual receipts. If a business hasn’t been in business for three years, multiply its average weekly revenue by 52 to determine its average annual receipts.”

General requirements

In addition to meeting the numerical standards for small, your business must:

  • Be a for-profit business of any legal structure
  • Be independently owned and operated
  • Not be nationally dominant in its field
  • Be physically located and operate in the U.S. or its territories

Also see

https://certify.sba.gov/am-i-eligible

Is the firm organized for profit?

Yes or No?

More Details:

  • Non-profit entities are ineligible to participate in most SBA small business programs.
  • The firm may be in the legal form of an individual proprietorship, partnership, limited liability company, S Corporation, or C Corporation.
  • Exceptions: This rule does not necessarily apply to Community Development Corporations (CDC) or businesses interested in participating as mentors in Mentor Protégé programs.

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