Question 1

Can a partnership qualify as an SDVOSB?

Accepted Answer

Yes. A general or limited partnership can qualify as an SDVOSB if service-disabled veterans own at least 51% of the partnership interests and control its operations. The veteran managing partner must hold the highest management position and direct daily business activities. Limited partnerships must ensure that non-veteran limited partners do not hold governance rights that undermine veteran control through the partnership agreement.

Question 2

What ownership percentage is required for SDVOSB status?

Accepted Answer

At least 51% of the business must be unconditionally owned by one or more service-disabled veterans. Ownership must be direct — ownership through an intervening entity generally does not count unless each layer of the structure is also more than 50% owned by service-disabled veterans. The 51% threshold applies to all economic interests including profits, losses, and liquidation rights.

Question 3

What control requirements must an SDVOSB meet?

Accepted Answer

The service-disabled veteran(s) must control the management and daily business operations of the firm. Control means the veteran must hold the highest officer position (e.g., CEO, President, or Managing Member), manage day-to-day operations, and possess the requisite managerial experience to run the business. The veteran cannot be a mere figurehead — non-veterans cannot run daily operations even if the veteran is the majority owner.

Question 4

Can an LLC qualify as an SDVOSB?

Accepted Answer

Yes. Limited Liability Companies (LLCs) are a common business structure for SDVOSBs. The service-disabled veteran must hold at least 51% of the membership interests and must serve as the Managing Member with full control over operations. Operating agreements must not grant non-veteran members rights that undermine veteran control, such as supermajority voting requirements for routine decisions.

Can a partnership qualify as an SDVOSB?

More on Eligibility & Certification

Related Questions

Related Tools & Directories