An accredited investor is an individual or legal entity with the financial means and experience to participate in private, higher-risk investments.
Qualified individuals and entities include:
- Individuals
- A natural person whose individual net worth, or joint net worth with their spouse or spousal equivalent, exceeds $1 million (excluding the value of their primary residence).
- A natural person with an income exceeding $200,000 in each of the last two years, or joint income with their spouse or spousal equivalent over $300,000 in each of those years, with a reasonable expectation of reaching the same income level in the current year.
- Holders in good standing of the Series 7, Series 65, or Series 82 licenses.
- Trusts and other entities
- A trust with total assets over $5 million, not formed specifically to acquire the offered securities, directed by a “sophisticated” person.
- Any entity in which all equity owners are accredited investors.
- Corporations, limited liability companies, or partnerships with total assets over $5 million, not formed specifically to acquire the offered securities.
- A “family office” with at least $5 million in assets under management, including its “family clients,” as defined under the Investment Advisers Act of 1940 (Rule 501).
For more information on the full definitions and requirements for accredited investors, visit the official SEC website.
