The SEC defines an accredited investor as either: an individual with gross income exceeding $200,000 in each of the two most recent years or joint income with a spouse or partner exceeding $300,000 for those years and a reasonable expectation of the same income level in the current year.
Accredited investors may invest in:
These entities sell investors securities that are called private placements, or Regulation D (Reg D) offerings. Unlike the Federal Reserve’s Regulation D, which has implications for savings accounts, the SEC’s Reg D guidelines exempt certain securities from SEC guidelines.
When a company registers a Reg D offering, it’s only required to submit basic information about the company’s location, officers and the offering itself. Any additional information an investor may receive is left entirely up to the company issuing the private placement.
A private placement memorandum (PPM) is a legal document provided to prospective investors when selling stock or another security in a business. ... The PPM describes the company selling the securities, the terms of the offering, and the risks of the investment, amongst other things.
By comparison, a company issuing public stock must go through a lengthy application process with the SEC and withstand intense due diligence to verify that the company has been truthful and has made all legally necessary disclosures.
At Avant Tax , we help our clients not only invest in Reg D offerings or PPMs , but also make Private Placement Memorandum(PPM) through our Attorneys and Financial Planners.