Veteran-Owned Small Businesses: Verify Eligibility Now or Risk Losing VOB Status

If you are a veteran owned business, by now you should have received a letter or email from the Department of Veterans Affairs (VA) requiring you to submit documents proving veteran ownership of your business. It is critical that you follow the directions of the letter/email to ensure that your business retains eligibility as a Veteran-Owned Small Business (VOSB).

Signed into law by President Obama on October 13, 2010, the Veterans Small Business Verification Act represents the latest update in the law that affects Veteran Business Owners by requiring them to verify their “Veteran-Owned” business status. As stated by the law’s sponsor, Representative Herseth Sandlin (D-SD), the law is intended to insure “that only veteran-owned businesses qualify for VOSB and SDVOSB status.” The sheer magnitude of documentation required by the verification process suggests that the VA intends to scrutinize the ownership of businesses and require strict compliance with the law governing VOSB and SDVOSB status. If your business relies on this status, it is essential that the documentation you submit provide sufficient evidence of veteran ownership.

To complete business registration with the VIP database as a Veteran Business Owner, you are required to submit an application to the VOSB Verification Program. The following is a brief summary of how the two-step process works:

First Step: Complete the Application
First, you must update your user profile on the VA website found at: www.vip.vetbiz.gov. Once you have reviewed your profile and completed any changes necessary to reflect the current state of your business, you may submit the update. After submission, you’ll be guided through the process of completing the application form for the VOSB Verification Program, marked “VA Form 0877.”

Second Step: Complete the Verification
The second step involves submitting a host of required documentation regarding your business to the VA. Depending on your business structure (whether sole proprietorship, partnership, LLC, or S Corporation) you may be required to submit certain documents specific to your business, such as business licenses, resumes, tax forms, contracts, lists of owners, or partnership agreements. The checklist of relevant documentation is included as an attachment in the Notice sent to Veteran Small Business Owners. Once all of the necessary documents requested on the checklist are compiled, you may submit the documents either by saving them on a compact disc and mailing the disc via commercial courier service to the appropriate VA address provided in the notice, or by uploading the documents electronically on the VA website.

Why Verification is Essential
All Veteran-Owned Small Businesses have ninety days from receipt of the Notice to complete this two-step process or the VA will remove the Business from the VIP database. While the process may be quite time-consuming (especially compiling and submitting the required documentation), it is essential that the application provide sufficient evidence of veteran ownership if you want your business to retain the distinction and benefits of a recognized Veteran-Owned Small Business. If the submitted documentation does not demonstrate true veteran ownership, it is likely the VOSB or SDVOSB status will be denied. If you think you need support with ensuring that the documentation provided is sufficient, you should contact a lawyer for assistance.

For an example of a letter please click on the following link: Example Letter

By Tim Aiken, Attorney, Law Offices of Fluet Huber + Hoang PLLC