Reg CF Investment Limits
Definition
Regulation Crowdfunding limits how much a non-accredited investor may invest across all Reg CF offerings, from all issuers on all platforms, in any 12-month period. Under Rule 100(a)(2), as amended in March 2021 and inflation-adjusted in 2022: if either the investor's annual income or net worth is less than $124,000, the limit is the greater of $2,500 or 5 percent of the greater of annual income or net worth; if both annual income and net worth are $124,000 or more, the limit is 10 percent of the greater of the two, not to exceed $124,000. Accredited investors are not subject to any limit. Net worth is calculated as it is for the accredited-investor definition, excluding the value of the investor's primary residence, and spouses may calculate jointly. The limit is enforced by the funding portal or broker-dealer, which must have a reasonable basis for believing the investor is within it and may rely on the investor's own representations unless it has reason to question them. It sits alongside a separate cap on the issuer: no more than $5 million raised under Reg CF in a 12-month period.
Why it matters
The investment limit is the part of Regulation Crowdfunding that treats the investor rather than the issuer as the thing to protect, and it is the only protection in the rule that scales with your own finances. It also has a design that is easy to misread: the test is 'greater of' at each step (greater of $2,500 or 5 percent; the greater of income or net worth), the thresholds are inflation-adjusted, and the cap is aggregate across platforms that cannot see each other. Two practical consequences follow. First, the limit is honored on your own numbers, so the responsibility to track a 12-month total across portals is yours, and a portal that lets you commit is not confirming you are within it. Second, the limit says nothing about whether a given offering is a good idea; an investor may lawfully put the whole allowance into one unsecured bond of one restaurant. The rule sets a ceiling on exposure to the segment, and the diligence on each issuer, the Form C financials, the annual-report record, the portal's servicing arrangements, is a separate exercise the limit does not perform for you.
Common misconceptions
- •The limit is not per platform or per offering. It is one 12-month total across every Reg CF investment you make anywhere.
- •It is not 'the lesser of' income and net worth. Since March 2021 the calculation uses the greater of the two, and the $2,500 floor applies whenever 5 percent of that figure would be lower.
- •Accredited investors are not limited. The 2021 amendments removed the cap for investors who meet the accredited definition; portals may still ask for the figures to establish that status.
- •The portal does not verify your limit. It relies on your stated income, net worth and prior Reg CF investments unless it has reason to doubt them; being allowed to commit is not confirmation.
- •The old thresholds ($2,200 and $107,000) are not the current ones. They applied from 2017 to 2022; materials still quoting them are out of date, not a different rule.
Technical details
The calculation, step by step
Step 1: are you an accredited investor? If yes, no limit applies (Rule 100(a)(2), as amended effective March 15, 2021).
Step 2: take your annual income and your net worth (primary residence excluded, calculated as for the accredited-investor definition; spouses may combine).
Step 3: if either figure is less than $124,000, the limit is the greater of (a) $2,500 and (b) 5 percent of the greater of the two figures.
Step 4: if both figures are $124,000 or more, the limit is 10 percent of the greater of the two figures, capped at $124,000.
Step 5: subtract every other Reg CF investment you have made in the preceding 12 months, on any platform; the remainder is what you may commit now.
Thresholds: $2,500 / $124,000 / $124,000 cap since the 2022 inflation adjustment; $2,200 / $107,000 / $107,000 from 2017 to 2022; $2,000 / $100,000 in the original 2016 rule. The SEC adjusts every five years.
Worked examples
Income $45,000, net worth $10,000: either under $124,000; 5 percent of $45,000 is $2,250, below the floor; limit $2,500.
Income $60,000, net worth $40,000: 5 percent of $60,000 is $3,000; limit $3,000.
Income $80,000, net worth $150,000: either under $124,000; 5 percent of $150,000 is $7,500; limit $7,500.
Income $130,000, net worth $200,000: both at or above $124,000; 10 percent of $200,000; limit $20,000.
Income $125,000, net worth $1,500,000: both at or above $124,000; 10 percent of $1,500,000 is $150,000, capped; limit $124,000. This investor is also accredited on net worth and therefore actually unlimited.
Spouses with joint income $110,000 and joint net worth $300,000: either under $124,000; 5 percent of $300,000; one joint limit of $15,000.
Prior investments: an investor with a $7,500 limit who invested $5,000 on one portal eight months ago may commit $2,500 on another today, and $7,500 again once the earlier investment is more than 12 months old.
Who enforces it and how
Rule 303(b)(1): the intermediary must have a reasonable basis for believing the investor satisfies the limit before accepting a commitment, and may rely on the investor's representations concerning income, net worth and other Reg CF investments in the prior 12 months unless it has reason to question them.
Rule 302(b): the intermediary's educational materials must explain the limits, and the investor must affirm having reviewed them and understanding the risk of loss.
In practice: figures entered at account opening, an attestation at each commitment, a system block above the computed limit on the portal's own books; no cross-portal check exists.
Issuer side: Rule 100(a)(1) caps the issuer at $5,000,000 in 12 months across its Reg CF offerings; the intermediary tracks it for offerings it hosts, and the issuer certifies it in the Form C.
Consequence of an investor exceeding the limit: none on the investor; the issuer's exemption is preserved where the intermediary reasonably relied on the representations.
How the limits changed
2016 (original Regulation Crowdfunding, effective May 16, 2016): issuer cap $1,000,000; investor limit the lesser of income and net worth as the base; $2,000 floor; $100,000 thresholds and cap; accredited investors limited like everyone else.
April 2017 inflation adjustment: $1,070,000; $2,200; $107,000.
March 15, 2021 amendments: issuer cap $5,000,000; base changed to the greater of income and net worth; accredited investors exempt from the limit; crowdfunding vehicles (SPVs) permitted; testing the waters permitted; 12-month resale restriction retained.
2022 inflation adjustment: $2,500; $124,000; $124,000 cap; the $5,000,000 issuer cap unchanged.
Next scheduled adjustment: on the five-year cycle, 2027.
What the limit does not do
It does not assess the offering. A non-accredited investor may put the entire allowance into a single unsecured bond of a single business; the rule limits exposure to the segment, not concentration within it.
It does not verify anything. The figures are self-reported; the portal's acceptance of a commitment is not a check.
It does not cover other exemptions. Regulation A Tier 2 has its own 10 percent limit for non-accredited investors per offering; Regulation D 506(c) is accredited-only; these are separate tests with separate counting.
It does not change the security's terms. Resale is restricted for one year with statutory exceptions regardless of how little was invested.
It does not survive a stale portal. SMBX's educational materials still stated the pre-2022 figures in September 2026; the current rule governs, and the investor is the one who has to know it.
Frequently asked questions
- How much can I invest in Regulation Crowdfunding per year?
- If you are not an accredited investor and either your annual income or your net worth is under $124,000, you may invest the greater of $2,500 or 5 percent of whichever is larger, your income or your net worth, across all Reg CF offerings in a 12-month period. If both your income and your net worth are $124,000 or more, you may invest 10 percent of the larger figure, up to a maximum of $124,000. Accredited investors have no limit.
- Is the limit per offering, per platform or in total?
- In total. The limit is an aggregate across every Regulation Crowdfunding investment you make in any 12-month period, on every portal, in every issuer. A $2,500 investor who puts $1,500 into a bakery on one portal has $1,000 left for the year on every other portal. Each portal can see only its own record, so the aggregate depends on your own figures, which is why the rule lets portals rely on your representations.
- How is net worth calculated for the Reg CF limit?
- The same way as for the accredited-investor test: assets minus liabilities, excluding the value of your primary residence (and excluding the mortgage on it up to that value; any mortgage above the home's value counts as a liability). Retirement accounts, brokerage accounts, bank balances and other property count as assets. Spouses may compute income and net worth jointly, in which case the combined limit is one limit, not two.
- Who checks whether I am within the limit?
- The funding portal or broker-dealer. Rule 303(b)(1) requires it to have a reasonable basis for believing you are within the limit before accepting a commitment, and it may satisfy that by relying on the income and net worth you state and your representation about other Reg CF investments in the last 12 months, unless it has reason to question them. In practice you enter figures at account opening and reaffirm at each commitment. No portal verifies your investments on other portals, and the SEC does not keep a central register.
- What are some worked examples?
- Income $60,000, net worth $40,000: either is under $124,000, so the limit is the greater of $2,500 or 5 percent of $60,000 ($3,000), which is $3,000. Income $80,000, net worth $150,000: either is under $124,000, so the greater of $2,500 or 5 percent of $150,000 ($7,500), which is $7,500. Income $130,000, net worth $200,000: both are at or above $124,000, so 10 percent of $200,000, which is $20,000. Income $200,000, net worth $2,000,000: this investor is accredited and has no limit; if they were not, the 10 percent rule would give $200,000, capped at $124,000.
- What is the issuer's limit under Reg CF?
- $5,000,000 in any 12-month period across all its Reg CF offerings, raised from $1,070,000 by the March 2021 amendments. Amounts raised under other exemptions (Regulation D, Regulation A) do not count toward it, and money raised in offerings that failed and returned funds does not count either. The issuer's cap and the investor's limit are independent: a $5 million raise can be filled by 2,000 investors at $2,500 or by a few accredited investors with no limit.
- Why do some platforms still quote $2,200 and $107,000?
- Those were the thresholds from the 2017 inflation adjustment through 2022. The SEC adjusts Regulation Crowdfunding's dollar amounts for inflation every five years, and the 2022 adjustment raised $2,200 to $2,500 and $107,000 to $124,000. Investor educational materials that were written before then and never updated still show the old figures; SMBX's did in September 2026. The current limit is the one that applies, and a portal quoting the old figures is understating what you may invest rather than overstating it, but it is a sign of how current its other materials are.
- Do the limits matter at typical crowdfunding ticket sizes?
- Rarely. On SMBX the average investor allocation across 211 funded bonds was about $856 and the minimum is $10; on Honeycomb the median campaign minimum is about $100. An investor at those sizes reaches even the $2,500 floor only by spreading across many offerings in a year, which the diversification logic of small-business lending encourages. The limits bind on investors trying to concentrate, which is the case the rule was written for.