Taxation of business entities.

How can a single SBA loan cover both a business purchase and a real estate purchase if the two are separate entities?

• I have a very specific question. I want to buy out my partner. He is a 50 percent owner of both the business and of the real estate. The business and real estate are separate entities. Can I still get one SBA loan to cover the entire purchase?

• Answer:

  is right on it being the lender's discretion. For example, the Small Business Administration states that http://www.sba.gov/content/use-7a-loan-proceeds cannot be used to: To affect a partial change of business ownership or a change that will not benefit the business For a purpose that is not considered to be a sound business purpose as determined by SBA If you are unsure whether or not your anticipated use of funds is allowed, check with your SBA-approved lender For the SBA's real estate and equipment use http://www.sba.gov/content/use-cdc504-loan-proceeds, it's not as clear as to whether or not that loan can be used to buy out a business partner in addition to the real estate purchase. Full disclosure: the company I work for, AmOne, for offers a free service that includes matching people with the highest-rated business loan solutions available, particularly for small businesses. http://www.amone.com/loans/small-business/ Depending on the current credit situation or the business or your own personal credit, you may be able to obtain alternative lending in order to effect the buy out. There are a number of different loan options available such as an unsecured small business loan (which is technically an unsecured personal loan for any use), a merchant cash advance, or bank statement financing. So if you're not able to use an SBA loan to cover the buy out, you may be able to obtain a different type of business loan to purchase the other half of the business and real estate.