The CfPA, or the Crowdfunding Professionals Association, is touting potential legislation aiming to boost the utilization and benefits of Reg CF or Regulation Crowdfunding. The proposed legislation, supported by the Coalition for Crowdfunding American Jobs and Prosperity (CCAJP); the Targeting Resources to Unleash Market Prosperity (TRUMP) Jobs Act, seeks to provide a tax benefit for investors in Reg CF issuers.
Reg CF is a private securities exemption that allows an issuer to raise up to $5 million. Investors may be retail or Accredited Investors. As the exemption requires a notice filing to pursue an offering, Reg CF can be a cost-effective path to raise growth capital for smaller firms. At the same time, the exemption is frequently paired with a Reg D offering, which allows an unlimited amount of funds to be raised from Accredited Investors.
The CfPA notes that since the JOBS Act, which legalized online capital formation, was signed into law and Reg CF became actionable (May 2016), over 8500 firms have used the exemption, raising over $2.2 billion from investors at an average investment of $1400.00. The CfPA claims that more than $7.5 billion in economic activity has been generated, along with over 400,000 new jobs. While most early-stage firms fail, firms using Reg CF have a better success rate, with failures accounting for just 10% of issuers.
The TRUMP Jobs Act is pretty simple as it provides for a 50% annual tax credit for investments up to $1000 for individuals or $2000 for married couples.
The CfPA predicts that the TRUMP Jobs Act could create over 1 million new jobs while driving $120 billion in economic growth.
Jenny Kassan, the 2025 President of the CfPA, said the policy represents a critical step forward for the crowdfunding industry:
“The TRUMP Jobs Act has the potential to create jobs, fuel economic growth, and empower more Americans to share in the success of our free enterprise system.”
Levi Brackman, CEO of Invown, a FINRA-regulated funding portal, said the legislation would boost innovative companies, with firms and investors benefiting from the opportunities.
CI connected with Brian Christie, co-chair of the CfPA, to inquire where the bill stands in the legislative process. Christie shared that they had just begun to share the draft bill with members of both the House and the Senate.
“We have someone on the House side that is taking this to the Joint Committee on Taxation for scoring but it’s premature to announce their support as a sponsor. I expect the sponsor for this legislation will become a rock star to the community of 8,500 business campaigns and 2 million plus Americans who have already participated in Regulation Crowdfunding. I anticipate we’ll have more to announce in the coming weeks,” said Christie.
He predicted bipartisan support for the bill, reflecting on the broad support the original JOBS Act received, which was signed into law during the Obama administration. Christie said that one of the major criticisms of the 2017 TCJA is that it disproportionately benefited the wealthy and large corporations.
“Our proposal directly addresses the gap since crowdfunded businesses are Main Street businesses and startup innovators who, along with their investors, drive local economies that are red, blue, or purple. By prioritizing these key players, we believe our approach will resonate across party lines as a practical, equitable solution.”
As for support from the White House, Christie said they are in contact with individuals who regularly communicate with President Trump.
Regarding the amount of the tax exemption which is relatively low, we asked if the CfPA considered a higher amount or potentially combining retail and institutional benefits. Additionally, what about supporting other exemptions like Reg A or Reg D 506c (both are crowdfunding exemptions)?
Christie said that with dynamic scoring and the expected ripple effect that these incentives create for the economy, their analysis indicates that this bill more than pays for itself.
“In fact, even at our proposed low level of credit, we anticipate it could drive a net surplus to the Treasury of $8 billion per year. If lawmakers come to the same conclusion, they may determine that the sky is the limit — and I think our industry would cheer that decision. However, with static scoring, every policy has a cost and requires a tradeoff. If we propose a much larger credit, then we may find our industry facing off against the interests of gigantic corporations in the Halls of Congress – not a good outcome. We’ve prioritized Reg CF because we aim to encourage new investors to start building the habit of investing as a pathway to wealth creation.”
Multiple industry insiders have advocated for Reg CF to increase from the current $5 million funding cap to a $20 million. Recently, it was reported that one influential VC thought $75 million made more sense. Christie noted that the CfPA approved a policy platform in 2024 that supported an increase to the $20 million amount
“I recently read that the crypto industry would like to see the limit raised to $75 million along with revisions to Regulation Crowdfunding to make it more crypto-friendly,” Christe added. “I view Reg CF as an onramp to Reg A — and with Reg A, issuers can already raise up to $75 million per year. What I’d like to see happen is for Congress to give the SEC clear authority to raise the Reg CF cap from $20 million onward and then let the SEC run their rulemaking process to evaluate increases at regular intervals.”
As private securities markets are booming, we asked Christie about his opinion on secondary markets enabling liquidity for the different exemptions. He said it was an important topic but is not part of the CfPA’s policy platform.
And should the Accredited Investor definition be reformed away from the current exclusionary rule that disenfranchises most of the population?
“Personally, I think it’s ridiculous that an Accredited Investor is defined mainly by the amount of money a person has — and the consequence of that policy blocks people from high potential opportunities, which, in turn, increases wealth inequity in America. I know others in the CfPA leadership share my view. But the Policy Committee at the CfPA did not reach a consensus on that issue and therefore, it was never presented to the board for a vote.”