Tilden Moschetti: My name is Tilden Moschetti. I am a syndication attorney and the founder of the Moschetti Law Group. We focus on private placements and doing private placement memorandums for
syndicators. One question we oftentimes get is, what exactly is an Accredited Investor anyway?

So what qualifies someone to be an Accredited Investor? Well, there's really a few different tests that tell us whether or not they are. Now first, there are some categories that I'm not going to talk
about here, I'm going to be talking just about individual investors. There are some different categories different ways to analyze if a organization is an accredited investor, but for the purposes of
this video, we're just going to talk about individuals. So they may hold a securities license, that one's pretty clear. If they hold certain securities licenses, they are allowed to be considered an
accredited investor. Now, those are very specifically securities licenses at this point, the rules may change. But it does not mean licensed real estate broker, it does not mean CPA, it does not mean
lawyer, it means that they actually have a securities license that's registered through FINRA, and also is known by the SEC. The main test, though that we look at are two, and they are the income test
and the net wealth test. So the income test asks this, it says is the net income of the investors so the taxable income is the number that we use, is that taxable income greater than $200,000 For the
past two years, the past two tax years, and likely to be present in the current year, if that amount is over $200,000, for an individual, or if you're signing with a spouse is that amount over
$300,000. So if you and your spouse are made both make $160,000 a year, that's fine. That's $320,000, which is over $300,000. That works, even though it's below that $200,000 mark. Or if you make
$210,000, and your wife doesn't make any, that's okay too, because you can come in under the individual status as well to make that investment. So that's the income test. So two years, $200,000 or
$300,000 of income, and then also have the same expectations for the current year. For the net wealth test, it actually asks just whether it's spouse or not, it says do they have over $1 million not

counting the value of any equity in the primary residence. So what that means is, you know, all the assets and all that the that the family has, or the investor has is that minus any liabilities is
that greater than the than $1 million. Now, when it comes to the family residence, if the family residence is underwater, then we do bring the residents into play just on the liability side. So say
that the house is worth $1 million, but you've got a loan of $1.2 million on it, then all we're doing is we subtract the $200,000 from the as part of calculating net wealth, so it could bring it down
some more. But we do not add any value if that same $1 million house has a loan on it for $500,000. You do not get that additional $500,000 To add to the asset column. So that is how we calculate and
figure out if you are a accredited investor. If you need some help with your syndication, be it for real estate, you're an entrepreneur, you're raising some capital for your business or you're putting
together that new cryptocurrency hedge fund. Give us a call. My name is Tilden Moschetti. I am a syndication attorney or visit us online on at www.moschettilaw.com or if you need help just with your
private placement memorandums, we've got you covered there too. ppm.moschettilaw.com