CPA letter to verify accredited investor status

SEC Rule 501(a) sets the definition. For individuals, the two financial tests are:

• Income test. Income over $200,000 in each of the two most recent years, or joint income with a spouse or spousal equivalent over $300,000 in each of those years, and a reasonable expectation of reaching the same level this year.
• Net worth test. Net worth over $1,000,000, alone or jointly with a spouse or spousal equivalent. Your primary residence is not counted as an asset. Mortgage debt on it, up to its estimated fair market value, is not counted as a liability.

You can also qualify by holding a Series 7, 65 or 82 license in good standing, or by being a director, executive officer or general partner of the issuer.

An issuer using Rule 506(c) may advertise its offering, but every buyer must be accredited and the issuer must take reasonable steps to verify it. The rule lists methods that count as reasonable steps:

• Income. Reviewing any IRS form that reports your income for the two most recent years, plus your written statement that you expect the same income this year.
• Net worth. Reviewing asset documents, such as bank and brokerage statements, and a credit report from one of the national credit bureaus, all dated within the prior three months, plus your written statement that all liabilities are disclosed.
• Written confirmation. A letter from a registered broker-dealer, an SEC-registered investment adviser, a licensed attorney or a certified public accountant stating that it took reasonable steps to verify your status within the prior three months and determined that you are accredited.

The written confirmation method lets you share one letter instead of handing tax returns and statements to every sponsor. In March 2025, SEC staff also said that high minimum investment amounts, with written representations and other conditions, can be reasonable steps. Ask the issuer which method it uses.

For the income test we review IRS forms for the two most recent years, such as W-2s, 1099s, Schedule K-1s or your filed Form 1040. If we prepare your returns, much of this is already in hand. See tax preparation.

For the net worth test we review statements for bank, brokerage, retirement and other accounts, documentation of other assets, and a consumer credit report for liabilities. We subtract liabilities and apply the primary residence rules.

The letter states which test you meet and the date of verification. It does not include your tax returns or account balances.

Best for: investors in private funds, real estate syndications and startup rounds that rely on Rule 506(c), and sponsors who want their investors to have a simple path.

1. Free initial consultation. Tell us which offering is asking and whether you qualify by income or net worth.
2. Fees quoted upfront, in writing. Transparent, fair fees before any work starts.
3. Documents. You send the income forms or the asset and liability statements for the test you are using.
4. Review. We compare the documents to the Rule 501(a) thresholds and follow up on gaps.
5. Letter. We issue a written confirmation you can share with the issuer, dated so it falls within the three-month window.