GSA Is Auditing 689 Former 8(a) Firms. If You Worked With Them, Get Your Records Ready.

What led SBA from 4,300 firms to 689, what GSA's audit looks for, and why the companies that worked alongside those firms should pull their records now.

A new federal audit of former 8(a) firms could pull in the records of the companies that worked with them.

What is GSA's 8(a) audit?

On October 21, 2026, the Small Business Administration (SBA) referred 689 firms it had removed from the 8(a) Business Development Program to the General Services Administration (GSA). GSA will audit the contracts those firms won while they were in the program.

According to SBA's announcement, the audit will look for "potential improper awards, false statements, and pass-through arrangements." Evidence of misconduct goes to the Department of Justice (DOJ).

That third item is why this matters beyond the 689 firms. In a pass-through arrangement, the 8(a) firm wins the contract and another company does most of the work. If your company subcontracted under an 8(a) prime, or partnered with one in a joint venture, your records are part of how the work was split.

SBA and GSA haven't published the firms' names. Whether or not one of your partners is on the list, the documents that show how your shared work was divided are in your own files, and you can start pulling them now.

What led to the 689

The referral is the latest step in a review SBA has run since mid-2025. Each step below comes from SBA's own releases.

SBA's October 21 release describes two groups among the 689: firms that exceeded the economic limits, and firms that refused to turn over their financial records. It doesn't say how the 689 match up with the 154 and 628 firms announced in February and March.

SBA classifies the removed firms as "inactive," and they can't win new 8(a) awards. Under SBA's rules, though, a firm that already holds an 8(a) multiple-award contract can generally keep receiving orders under it, unless the agency limits an order to current 8(a) participants.

GSA's announcement calls it a fraud audit and puts the firms' contracts at a combined ceiling of $5.5 billion. That figure is the most the contracts allow. GSA hasn't said that any of it was improperly paid.

What we don't know yet

Several things that would help contractors size their exposure aren't public:

• The names. SBA and GSA haven't published the list, so you can't look up whether a partner is on it.
• The math. SBA moved to terminate 782 firms (154 plus 628) and referred 689. Neither agency has explained the difference of 93. Some firms may have appealed successfully, left the program on their own, or appeared in both groups, but that's speculation.
• The mix. There's no public breakdown by industry, agency, location, or by whether firms were owned by individuals or by tribes, Alaska Native Corporations or Native Hawaiian Organizations. The D.C. group was removed under wealth limits that apply to individual owners, so it was likely made up of individually owned firms.
• The timeline. GSA hasn't said how long the audit will take or how it will contact other companies.

Why partners are part of this

The 8(a) program has rules about how much of the work the 8(a) firm itself has to do. A pass-through audit is, in practice, a check on those rules.

Limitations on subcontracting. Under 13 CFR 125.6, an 8(a) prime agrees to cap what it pays to subcontractors that aren't "similarly situated." For an 8(a) contract, a similarly situated firm is another certified 8(a) participant, and its work counts toward the prime's share only if it does that work with its own employees. The caps are:

• Services: no more than 50% of what the government pays the prime.
• Supplies: no more than 50%, with the cost of materials excluded.
• General construction: no more than 85%, with materials excluded.
• Specialty trade construction: no more than 75%, with materials excluded.

Work that a similarly situated subcontractor passes down to another firm counts toward the cap.

Joint ventures. Under 13 CFR 124.513(d), the 8(a) partner in a joint venture must perform at least 40% of the work the joint venture does, and that work must be more than administrative. Work done by the non-8(a) partner and its affiliates at any subcontracting tier counts toward the non-8(a) side. This also applies to mentor-protégé joint ventures, where a larger firm in SBA's mentor-protégé program teams with the smaller firm it mentors to bid on set-aside work.

Joint venture partners have obligations of their own. Every partner signs the certification that the work-share rules were met. Failing to meet them can be grounds for suspension or debarment, and joint venture partners must give SBA and its Inspector General access to the joint venture's records.

For subcontractors, the cap is the prime's obligation. But your invoices, timesheets and work-share reports show how much of the work your company did, and a reviewer checking the prime could ask for them.

SBA's December request specifically asked 8(a) firms for their "contracting and subcontracting agreements," so the government has already asked for the paperwork between primes and their partners.

What this doesn't mean

It doesn't mean the firms did anything wrong. Removal from the program is not a finding of fraud, and some firms were removed for missing a document deadline. A lawsuit an Alaska Native Corporation shareholder filed in February in federal court in Alaska alleges that some firms were suspended after submitting records a day late because of problems with SBA's portal. That's an allegation, and no court has ruled on it.

It doesn't mean sudden recompetes. Under 13 CFR 124.304(f)(1), a firm terminated from 8(a) "is obligated to complete previously awarded 8(a) contracts, including any priced options which may be exercised." Work held by removed firms will open up gradually, as contracts end or agencies decide not to exercise options.

What should subcontractors and JV partners do now?

SBA's dollar figures cover fiscal years 2021 to 2024, but GSA is auditing each firm's awards from its whole time in the program. If your company has worked with 8(a) firms in recent years, set aside time in the next few weeks to get organized.

1. List your 8(a) relationships. Every subcontract under an 8(a) prime, every 8(a) joint venture and every mentor-protégé agreement, with contract numbers and periods of performance.
2. Pull the work-share records. Teaming agreements, subcontract agreements and statements of work, invoices, timesheets or labor hour reports, and any work-share or limitations-on-subcontracting calculations. If nobody tracked the split at the time, find out now whether the records exist to reconstruct it.
3. Ask your partners directly. SAM.gov or SBA Small Business Search may show when a firm left 8(a), but not why it left or whether it was referred. Ask before you put a partner on a new bid.
4. Check SAM.gov for exclusions. An exclusion record in SAM.gov, such as a suspension or debarment, is a serious warning sign.
5. Know when the contracts you support end. If a removed firm holds a contract you work on, find out when the current period and any options run out, and what the recompete is likely to look like.
6. Talk to counsel if the exposure is large. If a significant share of your revenue came through 8(a) primes or joint ventures, have your lawyers look at the records before anyone else asks for them.

Where GovEagle fits

SBA and GSA haven't published the list, so GovEagle can't tell you which firms are on it. GovEagle also doesn't track 8(a) certifications.

What it can help with is research on your partners. Once your organization turns on the SAM.gov and USASpending connectors, you can ask GovEagle's agent in a chat to pull a partner's SAM.gov registration, exclusion records and USASpending award history while you review the relationship.

FAQs

Who are the 689 firms?

They're firms SBA removed from the 8(a) program earlier in 2026. SBA says some exceeded the program's net worth, income or asset limits, and others didn't turn over financial records when asked. SBA and GSA haven't published the names.

Can subcontractors and joint venture partners be pulled into the audit?

GSA hasn't said how it will contact other companies. But the audit looks for pass-through arrangements, which turn on how work was split between the 8(a) firm and its partners, and joint venture partners are required to give SBA and its Inspector General access to the joint venture's records.

What are the 8(a) subcontracting limits?

On a services contract, an 8(a) prime can pay no more than 50% of what the government pays it to firms that aren't similarly situated. The cap is 50% for supplies, 85% for general construction and 75% for specialty trade construction, with materials excluded. In an 8(a) joint venture, the 8(a) partner must do at least 40% of the work.

Does removal from 8(a) mean a firm committed fraud?

No. Some firms were removed for missing a document deadline, and removal is not a finding of fraud. GSA's audit will look for whether there were improper awards, false statements or pass-through arrangements.