Extension of Temporary Changes to 4506-C Tax Transcript Verification Procedures during the COVID-19 Emergency through September 30, 2021
Summary
SBA Procedural Notice 5000-813848, effective June 30, 2021, to 7(a) Lenders and Certified Development Companies, signed by Dianna L. Seaborn, Director, Office of Financial Assistance. It extends through September 30, 2021 the temporary guidance in SBA Procedural Notice 5000-810037 on verifying an applicant's financial information for 7(a) and 504 loans while the IRS experiences delays due to the COVID-19 pandemic. A lender that has submitted IRS Form 4506-C and received no response within 10 business days, or an incomplete transcript, may close and disburse the loan, must document its file with a dated copy of the second submission, and must complete the verification no later than 6 months from the date of the Note. A lender may also rely on an IRS stamp receipt of a filed return with an applicant certification that the tax information provided is identical to what was filed.
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SBA Procedural Notice
TO: All SBA Employees, 7(a) Lenders, and CONTROL NO.: 5000-813848
Certified Development Companies
SUBJECT: Extension of Temporary Changes to EFFECTIVE: June 30, 2021
4506-C Tax Transcript Verification Procedures
during the COVID-19 Emergency through
September 30, 2021
The purpose of this Notice is to further extend, through September 30, 2021, the temporary
procedural guidance relating to the verification of financial information for SBA Lenders
(including 7(a) Lenders and Certified Development Companies (CDCs)) set forth in SBA
Procedural Notice 5000-810037, which is currently in effect through June 30, 2021.
Due to the ongoing Coronavirus Disease 2019 (COVID-19) pandemic, the Internal Revenue
Service (IRS) continues to experience delays in some of its services. SBA recognizes that delays
in receipt of tax transcripts will affect the ability of SBA Lenders to comply with the Loan
Program Requirements to verify financial information of the Borrower prior to the first
disbursement of loan proceeds (for a 7(a) loan) and prior to submitting the closing documents to
SBA Counsel (for 504 loans).
This temporary guidance was first set forth in SBA Procedural Notice 5000-20016 and replaced
the guidance related to the timing of verification of financial information that is currently
described in SOP 50 10 6, Part 2, Section A, Chapter 6, Paragraph B. Through September 30,
2021, all SBA Lenders must follow the procedures set forth below to verify the Applicant’s
financial information provided in connection with a 7(a) or 504 loan application:
If the SBA Lender has submitted IRS Form 4506-C to the IRS and has not received a
response from the IRS within 10 business days, or has received an incomplete copy of the
tax transcript (e.g., the reported year 2019 or 2020 has not been completed by IRS
resulting in No Records Found for the applicable year), the SBA Lender:
i. May proceed to close and disburse the loan;
ii. Must document its file with a dated copy of the second submission and,
iii. Must perform the verification and resolve any significant differences discovered as
soon as the IRS response is received, but in no event later than 6 months from the date of
the Note.
Under current circumstances, if the local IRS office only provides a stamp receipt
(acknowledgement of filing) of the filed tax return in response to submission by the SBA Lender
PAGE 1 of 2 EXPIRES: 6-1-22
SBA Form 1353.3 (4-93) MS Word Edition; previous editions obsolete
Must be accompanied by SBA Form 58
Federal Recycling Program Printed on Recycled Paper
of IRS Form 4506-C, the SBA Lender may rely on this stamp receipt of the filed tax return as
evidence that the tax return was filed and continue with the application process. However, the
SBA Lender also must obtain a certification from the Applicant that the tax information provided
to the SBA Lender is identical to what was submitted to the IRS. Further, the SBA Lender must
comply with the remaining verification of financial information procedures described in SOP 50
10 6, Part 2, Section A, Chapter 6, Paragraph B and resolve any significant discrepancies as soon
as the SBA Lender receives the complete IRS response, but in no event later than 6 months from
the date of the Note.
Questions concerning this Notice may be directed to the Lender Relations Specialist in the local
SBA Field Office.
Dianna L. Seaborn
Director
Office of Financial Assistance
PAGE 2 of 2 EXPIRES: 6-1-22
SBA Form 1353.3 (4-93) MS Word Edition; previous editions obsolete
Must be accompanied by SBA Form 58
Federal Recycling Program Printed on Recycled Paper
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