Accredited Investor Qualification
SEC requirements for foreign investors in US private placements
Accredited Investor Thresholds
$200K
Individual Income
Last 2 years, expected this year
$300K
Joint Income
With spouse or partner
$1M
Net Worth
Excluding primary residence
$5M
Entity Assets
Minimum for entities
Income-Based Qualification
Qualify by demonstrating consistent high income over the past two years with reasonable expectation of maintaining it.
Individual Income Test
- $200,000+ each of last 2 years
- Reasonable expectation for current year
- Salary, bonuses, commissions count
- Self-employment income qualifies
- Investment income included
Joint Income Test
- $300,000+ combined with spouse
- Spousal equivalent included (2020+)
- Both incomes aggregated
- Same 2-year lookback
- Joint expectation for current year
Net Worth Qualification
Primary residence excluded from calculation
Assets That Count
- Cash and bank accounts
- Investment portfolios
- Retirement accounts (IRA, 401k)
- Real estate (not primary residence)
- Business ownership interests
- Vehicles and personal property
Liabilities to Subtract
- Mortgage (only if underwater)
- Student loans
- Credit card debt
- Car loans
- Business debts (if personal guarantee)
Professional Certifications
No income or net worth requirement needed
Certain professional credentials automatically qualify you as accredited regardless of wealth.
Qualifying Credentials
- Series 7 (General Securities Rep)
- Series 65 (Investment Adviser)
- Series 82 (Private Securities)
- Must be in good standing
Other Automatic Qualifiers
- Directors/officers of issuing company
- General partners of issuing fund
- Knowledgeable employees
- Family offices and family clients
Entity Qualification
$5M+ Asset Entities
- Corporations
- LLCs
- Partnerships
- Business trusts
- Not formed solely to invest
Look-Through Entities
- All owners must be accredited
- Can be formed to invest
- No minimum asset requirement
- Common for family offices
Foreign Investor Considerations
Same thresholds apply worldwide
The SEC accredited investor rules apply to foreign investors the same as US persons.
Currency Considerations
- Convert to USD at current rate
- Use consistent exchange rate
- Document conversion methodology
- Account for volatility
Additional Requirements
- Reg S vs Reg D considerations
- Tax treaty implications
- FATCA compliance
- Source of funds documentation
Required Documentation
Income Verification
- Tax returns (2 years)
- W-2 or equivalent forms
- Pay stubs
- CPA verification letter
- Employer confirmation
Net Worth Verification
- Bank statements
- Brokerage statements
- Property appraisals
- Credit report
- CPA or attorney letter