SBA Loans for Accounting Firms
Acquiring an accounting practice, buying out a partner, or expanding your CPA firm requires substantial capital. SBA loans offer the lowest rates and longest terms available, potentially saving your firm $50,000+ in financing costs over the loan life.
How much funding do you need?
Drag the slider or type an amount
SBA Financing for Accounting Practices
Accounting firms have predictable recurring revenue from tax clients, audit engagements, and bookkeeping retainers. SBA lenders recognize this stability when evaluating CPA firm financing.
Recurring Revenue Value
Accounting practices have exceptionally stable revenue from annual tax clients and monthly bookkeeping retainers. This predictability supports favorable SBA terms.
Practice Acquisition Common
Accounting firms commonly sell at 0.8-1.5x annual revenue. A $500K revenue practice might sell for $400K-$750K. SBA makes acquisition achievable.
Baby Boomer Transitions
Many CPA firm owners are retiring. The wave of accounting practice transitions creates acquisition opportunities for younger CPAs.
Client Retention Rates
Accounting practices typically retain 85-95% of clients through ownership transitions. Lenders value this client stickiness.
When SBA Financing Makes Sense
Major accounting firm investments deserve the best available terms.
Practice Acquisition Cost
CPA practices sell for 0.8-1.5x annual revenue. A $600K practice costs $480K-$900K. Substantial capital required.
Partner Buyout
Buying out a retiring partner requires immediate capital. Partnership valuations can be hundreds of thousands.
High Alternative Financing Cost
A $400K practice at 16% versus SBA at 9% costs $28,000 annually in extra interest.
Short-Term Payment Pressure
5-year terms on $400K require $8,500+ monthly payments. SBA 10-year terms nearly halve payments.
Office Expansion
Growing accounting firms need larger space and more staff. Expansion capital with favorable terms.
Technology Investment
Modern accounting requires technology: software, cloud systems, client portals. Investment in competitive capability.
Accounting Firm SBA Process
Plan for 60-90 days from application to funding. The timeline pays off in better terms.
Pre-Qualification
Review your situation to assess SBA eligibility and identify potential issues early.
1-3 days
Documentation
Assemble tax returns, financial statements, practice valuation, and business plan.
2-4 weeks
Underwriting
Lender and SBA review your application. Questions about revenue, client retention, and practice history.
4-8 weeks
Closing
Commitment letter, closing documentation, and funding.
1-2 weeks
Government-Backed Accounting Firm Financing
SBA loans provide the lowest cost of capital for qualified accounting firms. The documentation and timeline investment pays off through dramatically better rates, terms, and payments.
Lowest Interest Rates
SBA rates capped at Prime + 2.25-2.75% for larger loans. Current rates typically 9-11%.
Longest Terms
Up to 10 years for practice acquisition and working capital. Extended terms mean manageable payments.
Large Amounts
SBA 7(a) up to $5 million. Finance practice acquisition, expansion, or partner buyout.
Practice Acquisition
Buy an existing CPA practice, acquire a competitor, or purchase partner's share.
Recurring Revenue Valued
SBA lenders understand accounting's recurring revenue model and client retention.
No Balloon Payments
Fully amortizing loans with predictable payments. No large lump sum due.
Accounting Firm SBA Applications
Common situations where SBA provides optimal financing for accounting practices.
Practice Acquisition
Buy an existing CPA firm or accounting practice.
Typical funding: $200K-$2M
Partner Buyout
Buy out retiring partner or purchase partnership share.
Typical funding: $150K-$1M
Merger Financing
Capital for merging with another accounting firm.
Typical funding: $200K-$1.5M
Office Expansion
Larger space, buildout, and equipment for growing firm.
Typical funding: $100K-$500K
Technology Investment
Software, cloud systems, cybersecurity, and client portals.
Typical funding: $50K-$200K
Debt Refinancing
Replace expensive alternative financing with lower-rate SBA.
Typical funding: $150K-$500K
SBA vs. Alternative Accounting Firm Financing
Understanding the trade-offs for CPA practice financing.
| Feature | SBA 7(a) Loan | Bank Term Loan | Working Capital |
|---|---|---|---|
| Interest Rate | Prime + 2-3% | 10-16% | 15-25% |
| Maximum Term | 10 years | 5-7 years | 1-3 years |
| Maximum Amount | $5 million | $500K typical | $300K typical |
| Down Payment | 10-20% | 10-25% | 0% |
| Time to Fund | 60-90 days | 2-6 weeks | 1-2 weeks |
| Documentation | Extensive | Moderate | Light |
| Credit Requirements | 680+ | 650+ | 600+ |
| Best For | Major investments | Mid-range needs | Quick access |
SBA Requirements for Accounting Firms
SBA eligibility requirements for CPAs and accounting practices.
CPA License or Accounting Credentials
Licensed CPA or appropriate accounting credentials for practice type.
Active license
Practice Experience
Experience in public accounting or firm ownership/management.
2+ years experience
Personal Credit
Good personal credit from principal owners.
680+ typically required
Revenue History
Demonstrated revenue and client base for existing firms.
Stable or growing revenue
Owner Equity
Owners must contribute equity, typically 10-20%.
10-20% equity injection
Business Plan
Detailed business plan for acquisitions or major expansion.
Comprehensive plan
Younger CPAs acquiring retiring partners often qualify with strong credentials and transition support from sellers.
Real Results
Williams & Associates CPA
CPA Firm, Colorado
The Challenge
Senior partner retiring wanted $520,000 for his 40% stake in a firm producing $850,000 annually. Junior partners needed acquisition financing without crushing payments.
The Solution
SBA 7(a) loan for $470,000 at 9.25% over 10 years with $50,000 equity contribution. Monthly payment: $6,050.
The Result
Partner buyout completed. Fixed monthly payments manageable alongside firm operations. Client retention exceeded 92%. Junior partners now own 100% of growing practice.
“Alternative financing quoted $9,500 monthly. SBA payments of $6,050 let us invest in staff and client development. The extra timeline was worth every day of waiting.”
Accounting Industry SBA Data
Statistics on SBA financing for accounting practices.
SBA Advantages for Accounting Firms
Why SBA effort is worth it for CPA practice financing.
Massive Interest Savings
On $400K loan, 9% vs 15% saves $24,000 annually. Over 10 years, substantial savings.
Practice Ownership Path
Lower payments make acquisition achievable for senior associates and junior partners.
Recurring Revenue Valued
Lenders recognize accounting's stable, recurring revenue model.
Cash Flow Preservation
Lower payments preserve cash for staff, marketing, and technology.
Transition Support
SBA designed to support practice transitions and ownership changes.
Growth Capital
Finance not just acquisition but growth and expansion.