Rule 505 (repealed)
Rule 505 is no longer available. The SEC repealed it effective May 22, 2017.
Last reviewed November 2026
What Rule 505 allowed
Rule 505 exempted offerings of up to $5 million in 12 months to unlimited accredited investors and up to 35 non-accredited investors, without general solicitation. Unlike Rule 506(b), it didn’t require non-accredited investors to be sophisticated.
Why it went away
Few issuers used it. Rule 505 offerings weren’t exempt from state registration, so Rule 506 was usually the better choice. In 2016 the SEC raised the Rule 504 limit to $5 million and repealed Rule 505, which took effect on May 22, 2017. Rule 504’s limit has since risen to $10 million.
What to use instead
- Rule 504 for offerings up to $10 million that include non-accredited investors
- Rule 506(b) for offerings of any size without general solicitation
- Rule 506(c) for offerings of any size with general solicitation to verified accredited investors
If your offering documents still mention Rule 505, update them.
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