The income test: $200K or $300K

One spectacular income year can change your life. It cannot go backward and edit last year’s tax record.

The income test is a sequence, not a highlight reel. People remember the number because the number flatters them. The calendar is the part that ruins the speech.

For individuals, the familiar path is income above $200,000 in each of the two most recent years, or joint income above $300,000 with a spouse or partner in each of those years, plus a reasonable expectation of reaching the same income level in the current year.

The rule measures a sustained income pattern. It does not award legal status for momentum.

Three locks, one doorway

Put the test on paper:

• The first of the two most recent years cleared the applicable threshold.
• The second of the two most recent years cleared the applicable threshold.
• The current year is reasonably expected to reach the same level.

Every lock matters. Two green boxes and one motivational speech do not open the door.

This article is not deciding your status. It is showing you which records must agree before you rely on this path.

Income needs a paper trail

In verification-heavy contexts, income is usually supported by tax documents or IRS forms that report income: W-2, 1099, Schedule K-1, Form 1040, or similar records.

A pay stub, employment agreement, or bonus letter may help support the current-year expectation. A strong quarter can explain the forecast. It cannot serve as a time machine for a prior year that missed.

For 506(c) offerings, the issuer has to take reasonable steps to verify accredited status. That is a different world from casually checking a box. Ask what the issuer or third-party verifier requires before throwing sensitive tax records into an email thread with six strangers copied.

A promotion cannot rewrite the calendar

An investor made $215,000 two years ago, $240,000 last year, and has a signed employment agreement showing the current year should land around $230,000.

That is a coherent individual income path.

Another investor made $180,000 two years ago, $260,000 last year, and expects $300,000 this year. Strong trend, maybe great career. Still not the standard income path because one of the two prior years missed.

The second investor did not fail at income. The claimed doorway simply measures something the record does not show yet. A promotion is good news, not retroactive evidence.

Joint does not mean mix-and-match

If you use the joint threshold, make sure the relationship and documents match the rule and the verification request. Do not pull one person’s number from one year, another person’s number from the next, and call the collage a record.

Also keep qualification separate from capacity. High income may arrive beside high expenses, taxes, debt, concentrated employment risk, or family obligations. The rule can recognize your income while your balance sheet tells you to keep your wallet closed.

Build the two-year file

Before relying on income, answer these questions:

• Which two tax years does the process use?
• Do the final records clear the applicable threshold in each year?
• What document supports the current-year expectation?
• Is the offering using self-certification, third-party verification, or issuer review?
• How are bonuses, commissions, K-1 timing, or business income being handled?

Pull the last two years of income records. Write the current-year support in one sentence and attach the document behind it. If one of the three locks still rattles, ask the issuer, verifier, CPA, or counsel what process applies before claiming the door is open.