Female business owner consults male colleague.
If your business is at least 51% woman-owned, you can qualify for economic resources and federal contracts. — Getty Images / Fizkes

If your business is at least 51% woman-owned and operated, you may be eligible for certification as a woman-owned business. The federal government aims to award a minimum of 5% of all contracting dollars to women-owned businesses each year, with certain contracts being set aside for woman-owned businesses that are economically disadvantaged.

By obtaining a woman-owned business certification, you will have access to federal contracts and the economic resources that can help your company grow. Here’s how to get certified as a woman-owned business.

[Read: How to Get Certified as a Minority-Owned Business]

Types of certifications

There are two certification types: woman-owned small business and economically disadvantaged woman-owned small business. The eligibility requirements for each are as follows:

Woman-owned small business (WOSB)

To qualify as a WOSB, your business must be for-profit and meet the requirements of a small business as defined by the Code of Federal Regulations. Operations must be primarily based in the United States, although certain foreign firms may qualify under specific conditions.

Your business must also be at least 51% unconditionally and directly owned by women who are U.S. citizens. The woman or women must be the ones who manage daily operations, make long-term decisions and hold the highest officer positions available. They must also work at the business full-time during normal working hours, although there is no minimum amount of time for the business to be considered operational.

Economically disadvantaged woman-owned small business (EDWOSB)

To qualify as an EDWOSB, your business must meet all of the above conditions of a WOSB as well additional economic requirements. A business owner’s personal net worth must be less than $750,000, and their adjusted gross income average over three years must be less than or equal to $350,000. The fair market value of all assets must be $6 million or less.

These financial requirements exclude equity in business and primary personal residence, income reinvested or used to pay business taxes, and funds invested in official retirement accounts (if they cannot be accessed until retirement).

There are two classifications: woman-owned business and economically disadvantaged woman-owned business.

How to get certified as a woman-owned business

Before your business is eligible to apply for federal contracts, you must apply for certification. This can be done through either a self-certification or third-party certification process. Neither process is “better” or preferred by governing bodies; it entirely depends on your personal preference.

Self-certification as a WOSB or EDWOSB is free. To do this, apply directly via the U.S. Small Business Administration (SBA). You’ll need an active registration in the System for Award Management, as well as the following documents:

  • Birth certificates, naturalization papers or unexpired passports for each woman business owner.
  • Articles of organization/incorporation, partnership or joint venture agreements, voting agreements, and any amendments to these documents.
  • Issued stock certificates and stock ledger.
  • Assumed/fictitious name certificate.
  • Three most recent personal tax returns including W-2’s and all schedules for each woman business owner and her spouse (for EDWOSB).
  • IRS Form 4506-T, Request for Tax Transcript for each woman business owner and her spouse (for EDWOSB).

If your business has an 8(a) certification for ownership by economically-disadvantaged individuals, and you are also applying for an EDWOSB certification, you may upload your 8(a) certificate and annual review letter instead of the above financial statements. These federal programs use the same criteria to determine certification eligibility.

Alternatively, you can obtain your WOSB certification through one of four approved third-party organizations (specific requirements and associated fees will vary by organization):

Once you are certified, you will need to provide proof of your third-party certification to the SBA by uploading your current certificate and joint venture agreement (if applicable). If you are looking for additional women-owned business resources, take a look at our list of some of the top programs that provide assistance to women-owned businesses.

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Published September 02, 2020