Accredited Investor Rules

Extracted Attributes

• Purpose

  To ensure that investors participating in highly risky and complex investments are financially sophisticated, able to judge risks, and can sustain potential losses, in the absence of government protection.

• Definition

  A special status for investors under financial regulation laws, typically including high-net-worth individuals, banks, financial institutions, and large corporations.

• Global Variation

  The definition and consequences of being classified as an accredited investor vary between countries/jurisdictions.

• Investment Access

  Access to complex and higher-risk investments such as venture capital, hedge funds, angel investments, pre-IPO companies, private credit, and private equity.

• Regulatory Body (US)

  U.S. Securities and Exchange Commission (SEC) under Rule 501 of Regulation D.

• Eligibility (US - Role)

  Directors, executive officers, or general partners of the company selling the securities (or of a GP of that company).

• Threshold Stability (US)

  Income and net worth thresholds for accredited investor status in the U.S. have not been adjusted for inflation for decades.

• Eligibility (US - Entity)

  Any 'family client' of a 'family office' that qualifies as an accredited investor, or entities where all equity owners are accredited investors.

• Eligibility (US - Income)

  Annual income exceeding $200,000 for an individual, or $300,000 for joint income, for the last two years with the expectation of earning the same or higher in the current year.

• Eligibility (US - Net Worth)

  Total net worth of at least $1 million, not including the value of their primary residence.

• Eligibility (US - Professional Certifications)

  Holding in good standing professional certifications or designations designated by the SEC, such as Series 7, Series 65, or Series 82 licenses.

Timeline

• The U.S. House of Representatives approved a bill to expand the definition of who can qualify as an accredited investor under federal securities laws, allowing for qualification via an SEC test. (Source: web_search_results)

  2025-07-23

• A spirited debate regarding the reform of Accredited Investor Rules as a potential pathway to greater Upward Mobility erupted between Jason Calacanis and David Friedberg on the All-In Podcast. (Source: related_documents)

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Accredited investor

An accredited or sophisticated investor is an investor with a special status under financial regulation laws. The definition of an accredited investor (if any), and the consequences of being classified as such, vary between countries. Generally, accredited investors include high-net-worth individuals, banks, financial institutions, and other large corporations, who have access to complex and higher-risk investments such as venture capital, hedge funds, and angel investments. Laws may require that some types of financial offerings may only be made to accredited investors.

Web Search Results

• Accredited Investor: Duties and Requirements - Investopedia

  The regulators want to be certain that participants in these highly risky and complex investments can fend for themselves and judge the risks in the absence of government protection. The Bottom Line --------------- The accredited investor rules are designed to protect potential investors with limited financial knowledge from risky ventures and losses they may be ill equipped to withstand. [...] For accredited investors, there is a high potential for risk or reward. The SEC wants to ensure that they are financially stable, experienced, and knowledgeable about their risky ventures.21 Requirements for Accredited Investors ------------------------------------- The regulations for accredited investors vary among jurisdictions. In the U.S, the definition of an accredited investor is put forth by the SEC in Rule 501 of Regulation D.3 [...] To be an accredited investor, a person must have an annual income exceeding $200,000 ($300,000 for joint income) for the last two years with the expectation of earning the same or a higher income in the current year. The income test cannot be satisfied by showing one year of an individual's income and the next two years of joint income with a spouse.3

• House votes to expand accredited investor opportunity with SEC test

  Accredited investor rules are about consumer protection: The limits "ensure that all participating investors are financially sophisticated and able to fend for themselves or sustain the risk of loss," according to the SEC's Investor.gov. Private securities are less liquid, harder to value and more volatile than publicly-traded assets, experts say. Opening 401(k)s to private markets: Here's what to know [...] The U.S. House of Representatives Monday approved a bill to expand the definition of who can qualify as a so-called "accredited investor" under federal securities laws. Accredited investors are permitted to invest in a wider range of assets, including pre-IPO companies, private credit and equity, venture capital and hedge funds. [...] Currently, to qualify as accredited, investors generally need an annual earned income of $200,000 for individuals, or $300,000 for married couples. Individuals or couples can also qualify with a total net worth of at least $1 million, not including the value of their primary residence. (Those thresholds are not pegged to inflation and haven't changed in decades; as a result, more households have become accredited over the years as wealth and incomes grow.)

• 17 CFR § 230.501 - Definitions and terms used in Regulation D.

  Cornell University insignia # 17 CFR § 230.501 - Definitions and terms used in Regulation D. As used in Regulation D (§ 230.500 et seq. of this chapter), the following terms shall have the meaning indicated: (a) Accredited investor. Accredited investor shall mean any person who comes within any of the following categories, or who the issuer reasonably believes comes within any of the following categories, at the time of the sale of the securities to that person: [...] (10) Any natural person holding in good standing one or more professional certifications or designations or credentials from an accredited educational institution that the Commission has designated as qualifying an individual for accredited investor status. In determining whether to designate a professional certification or designation or credential from an accredited educational institution for purposes of this paragraph (a)(10), the Commission will consider, among others, the following [...] It is permissible to look through various forms of equity ownership to natural persons in determining the accredited investor status of entities under this paragraph (a)(8). If those natural persons are themselves accredited investors, and if all other equity owners of the entity seeking accredited investor status are accredited investors, then this paragraph (a)(8) may be available.

• "Accredited Investor" Net Worth Standard - SEC.gov

  The accredited investor concept identifies investors who are eligible to participate in those offerings of unregistered and illiquid securities. In order to

• Accredited Investors - SEC.gov

  For many companies raising capital in the private markets, theaccredited investordefinition may define who is in their pool of potential investors, and for investors whether they are eligible to invest. Many of theoffering exemptionsunder the federal securities laws limit participation to accredited investors or contain restrictions on participation by non-accredited investors. [...] Investment professionals in good standing holding the general securities representative license (Series 7), the investment adviser representative license (Series 65), or the private securities offerings representative license (Series 82) Directors, executive officers, or general partners (GP) of the company selling the securities (or of a GP of that company) Any “family client” of a “family office” that qualifies as an accredited investor [...] For manycompanies raising capital in the private markets, the accredited investor definition largely determines may definewho is in their pool of potential investors, and for investors whether they are eligible to invest in many early-stage companies. Many of the offering exemptions under the federal securities laws limit participation to accredited investors or contain restrictions on participation by non-accredited investors.