Accredited investor

A U.S. securities-law category defined in Regulation D, Rule 501(a). Accreditation can affect eligibility for particular exempt offerings; it is not a universal requirement for every private offering.

Accredited investor in round numbers

For an individual, one route is income exceeding US$200,000 in each of the two preceding years, or joint income exceeding US$300,000 with a spouse or spousal equivalent in each year, with a reasonable expectation of reaching the same level in the current year. Another is individual or joint net worth exceeding US$1 million, excluding the primary residence under the rule’s applicable mortgage-debt provisions.

Other routes include holding specified professional licenses in good standing, such as Series 7, 65 or 82. Rule 501(a) also provides categories for certain issuer insiders, knowledgeable employees and entities.

Source: 17 CFR 230.501(a), accredited investor categories · SEC: Accredited Investors — Updated Investor Bulletin.

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