14 Tips to Become an Accredited Online Business Investor

Mortgages on real property also are considered liabilities.

• If you have a mortgage on your primary residence.
• It generally is not included as a liability since you can’t include the value of that property as an asset. However, a portion of it may be subtracted from your net worth as a liability if you owe more than the fair market value of your home.
• Or if you’ve recently taken out a home equity line of credit.

4. Arrive at your net worth.

For purposes of becoming an accredited investor.

Your net worth is the total value of your assets minus the total amount of your liabilities.

To qualify as an accredited investor, this amount must be more than $1 million.

• If you’re close to the threshold and still want to become an accredited investor.
• Talk to an attorney who specializes in security law to learn more about your options.

See also:18 Tips to Find investors in Nigeria

5. Take exchange rates into account.

The SEC’s rules require that accredited investors meet certain threshold income or net worth requirements expressed in US dollars.

If you live outside the US, you’ll need to double-check your figures.

• Companies that verify your information have the option of using the exchange rate for the last day of the year the income is being determined, or the average rate for that year.
• To be on the safe side, make sure you qualify using both of those rates.

Accredited Online Business Investor

6. Get copies of the past two years’ tax returns.

While there is no required process to become an accredited investor.

Companies must take reasonable steps to verify your investor status before you can make a stock purchase.

• If you plan to use the annual income test, the company will require copies of your income taxes for the past two years to verify that your income surpasses the threshold.
• If you are not a Nigerian taxpayer and still want to use the annual income test.
• You may also need to present proof that your country imposes penalties for providing false information on tax returns that are similar to those in the US.

View also:Top 35 Cassava Production Feasibility Study in Nigeria

Accredited Online Business Investor

7. Request a copy of your credit report.

The company issuing the stock you want to buy will likely run a credit check on you to verify your liabilities if you’re trying to qualify as an accredited investor under the net worth test.

• While the company typically will make their own request rather than simply taking a copy you provide, it’s in your best interests to go ahead and pull a copy of your own report so you can see what’s on it and correct any errors you might find.

See also:Tips to Start Adult Pull-up Diapers Business in Nigeria

Accredited Online Business Investor

8. Pull together banking and brokerage statements.

If you’re using the net worth test, you’ll need proof of all the assets you’ve listed.

The statements must be recent and should identify you as the owner of the asset and clearly state the value of the asset.

• You may want to get these documents signed or certified. Talk to your bank or investment advisor to find out the process for doing this.
• You also may want to get copies of any ownership documents, such as deeds or titles.
• If you own real property that hasn’t been appraised in the last year or so.
• Go ahead and get an appraisal on the property.
• So you will have the most recent fair market value of the property.

Read on:27 Tips to Start Botox/Dermal fillers Business in Nigeria

Accredited Online Business Investor

9. Talk to an attorney, accountant, or investment advisor.

Some companies will accept a letter from an independent third party as proof of the value of your assets.

If you decide to go this route, choose someone who is a certified financial professional.

• A letter from an attorney or investment advisor can be especially helpful if you have assets that are particularly difficult to value, or if you have assets in the country and in foreign countries.
• A financial professional also can help you understand what information and documents you’ll likely need to verify your status.

See also:30 Tips to Open Solar Panels & Accessories Store in Nigeria

Accredited Online Business Investor

10. Obtain an investor questionnaire.

Under the SEC rules, companies that issue unregistered stock.

Are required to verify that anyone purchasing that stock is an accredited investor.

Each company typically has a form you must fill out listing your income, assets, and liabilities.

• You will have to provide documentation to back up any of the information you include on the questionnaire.
• While each questionnaire may have some differences, most of them ask the same basic questions.
• The questionnaires are designed to track the SEC rules so that the company can determine with a glance whether you qualify as an accredited investor.

Accredited Online Business Investor

11. Provide your personal information.

Investor questionnaires ask for basic personal information, including your name.

The address of your primary residence, and whether you are married.

You also may be asked your job title and educational background.

• If you have an attorney or investment advisor who assists you with any of the assets listed on the form, there will be space for you to provide their name and contact information.

Read on: Top 16 Music /Video Games Money Earning Tips in Nigeria

Accredited Online Business Investor

12. Describe your income and assets.

The questionnaire will include spaces for you to list your total income and assets.

You typically won’t have to itemize anything on the questionnaire, just give a total amount. 

• The purpose is to determine whether you qualify as an accredited investor.
• If you don’t qualify based on your answers.
• The company typically won’t ask you for any supporting documentation.
• On the other hand, if you claim you have assets totaling $1 million or more, or income of $200,000 to $300,000, the company will need documentation to back up those claims.

See also: Top 18 Current Structural Chain in Agriculture Worldwide

Accredited Online Business Investor

13. Sign the document certifying the information.

You typically must initial in several places certifying that you believe you qualify as an accredited investor.

You also must certify that you have knowledge and experience with finances and investment.

And are capable of making sound investment decisions.

• It’s okay if you have limited investment experience on your own.
• As long as you have a securities attorney or an investment advisor working with you.
• When you sign the questionnaire you are certifying that all the information you have provided on the form is complete and accurate to the best of your knowledge.
• Your signature typically doesn’t have to be notarized.
• And it isn’t a legal document in the sense that you face perjury penalties.
• However, you won’t be able to purchase stock in the company.
• If you can’t provide documentation to back up the information you provided on the questionnaire.

Accredited Online Business Investor

14. Submit all requested documentation.

The company typically will be in touch with you to request specific documents.

That will back up the claims you made on the questionnaire.

In some cases you’ll be provided a list of documents to submit along with the questionnaire.

• Pay attention to the requirements.
• Some documents may need to be certified.
• If you are a foreign investor, some documents may need to be translated into English.
• These translations may need to be certified.
• Contact the company issuing the stock to find out for sure.