Reference
What is an accredited investor?
It is a definition set by the SEC that decides which private investments you are allowed to buy. There are three ordinary ways an individual qualifies, and the two best-known ones have not been adjusted for inflation in over forty years, which is why the group keeps growing.
The three routes for an individual
Income
More than 200,000 dollars in individual income in each of the two most recent calendar years, with a reasonable expectation of the same in the current year. Filing jointly with a spouse or spousal equivalent raises the bar to 300,000 dollars across the household. You cannot mix and match: use the individual figure for individual income, or the joint figure for joint income, not one year of each.
Net worth
A net worth above one million dollars, individually or with a spouse, excluding the value of your primary residence. That exclusion does real work. Equity in the house you live in does not count, and mortgage debt on it generally does not count against you either, but debt secured against the residence above its fair market value does.
Professional licence
Since 2020 there is a knowledge-based route with no money test at all. Holding a Series 7, Series 65 or Series 82 licence in good standing qualifies you. The licence has to be current: lapsed or inactive does not count. This route matters more than most people realise, because the Series 65 can be taken without sponsorship by a broker-dealer.
Entities qualify too
Trusts, LLCs, partnerships and corporations can be accredited, most commonly by holding more than five million dollars in assets, or by being an entity in which every equity owner is an accredited investor. Family offices and their clients have their own route. Knowledgeable employees of a private fund count as accredited with respect to that fund, regardless of personal wealth.
The part nobody mentions: the numbers have not moved
The income thresholds were set in 1982 and the net worth test was fixed at one million dollars, excluding the primary residence, by the Dodd-Frank Act in 2010. Neither has been indexed to inflation. Adjusted for inflation from 2010 alone, the net worth test would sit somewhere near 1.4 million dollars in today money, and adjusted from 1982 the income test would be several times its current level.
The practical consequence is that the accredited pool expands every year without anyone voting on it. Households that were plainly middle-class savers a generation ago now clear a bar written for the wealthy. The SEC has signalled it may revisit the definition, in both directions at once: loosening it by widening the knowledge-based routes, and tightening it by finally adjusting the dollar figures. Anyone building a business around the current numbers should treat them as a moving target.
What it actually unlocks
Accredited status is permission to be sold to, not a certification of skill. It opens private placements under Regulation D, most venture and private equity funds, real estate syndications, private credit and a range of alternative vehicles that cannot be marketed to the general public.
It removes a layer of protection rather than adding one. Private offerings carry no requirement to register, far lighter disclosure duties, and often no liquidity. The premise of the definition is that you can absorb a total loss and can fend for yourself in evaluating the risk. Whether that premise holds for any particular investor is a separate question from whether they clear the threshold.
Self-reported versus verified
This distinction causes real problems, and it is worth being precise about. In many private offerings an investor simply represents in writing that they are accredited, and the issuer may reasonably rely on that. In others the issuer is legally required to take affirmative steps to verify it, which means reviewing tax returns, bank and brokerage statements, or accepting a written confirmation from a lawyer, CPA, broker-dealer or investment adviser.
Which regime applies depends on the exemption the issuer chose, not on the investor preference. If you are raising money, that choice is one of the most consequential you will make. See 506(b) versus 506(c) for what changes.
Frequently asked
What are the accredited investor income requirements?
More than 200,000 dollars in individual income in each of the two most recent calendar years with a reasonable expectation of the same this year, or more than 300,000 dollars in joint income with a spouse or spousal equivalent over the same period.
Does my house count toward the net worth test?
No. The one million dollar net worth test explicitly excludes the value of your primary residence. Mortgage debt secured by that residence is generally excluded as well, except to the extent it exceeds the fair market value of the home.
Can I become an accredited investor without being wealthy?
Yes. Holding a Series 7, Series 65 or Series 82 licence in good standing qualifies an individual regardless of income or net worth. The Series 65 in particular can be taken without a broker-dealer sponsor.
Have the accredited investor thresholds changed for 2026?
No. The income figures date from 1982 and the one million dollar net worth test, excluding primary residence, was fixed by the Dodd-Frank Act in 2010. Neither is indexed to inflation, and both remain unchanged. The SEC has indicated it may revisit the definition.
Who decides whether I am accredited?
The issuer of the securities you are buying. Depending on which Regulation D exemption they rely on, they may accept your written representation or they may be required to verify your status with documents.